The construction industry is a major contributor to the UK economy and brings in £90 million annually. It is responsible for enhancing the infrastructure that is key to how other industries operate. However, construction companies mostly face a lot of problems from governments and other citizens of the area.
Unfortunately, it is not celebrated and nurtured sector of the economy. Many small companies that run construction-related businesses have to overcome many challenges to stay afloat. Five of the significant concerns affecting small construction companies are discussed below.
1. Shortage of skilled labor:
Despite the prevalence of technology, much of the construction sector still depends on manual labor. Since the demand remains consistent, it is essential that construction companies also have a steady workforce with the required skills and technical know-how to keep up with innovation.
However, the problem in the UK which is also echoed in other countries is that the workforce is aging. Around 22% of construction workers in the UK are over 50 years old, while another 15% is in their 60s.
It is very important that some architects and construction workers do spite ahead because this job can work some, but it gains you more profit. Plus you get to be part of the development of the city. It is likely that the industry will suffer from a shortage of skilled workers within the next decade.
2. Adopting new technology:
Many small construction companies lack the capital to invest in technology. As such, these companies will likely lose out on projects. Some of the current innovations shaping the industry include IoT, sophisticated computer software, and wearables. To remain competitive, construction companies can resort to hiring equipment.
For example, if the company does not have the resources, there are companies like Crane Hire Lincoln that can lease the latest equipment vital for certain types of projects.
3. The complexity of projects:
Construction projects continue to become demanding and complicated and will become challenging for small companies due to a lack of a skilled workforce. As such, these companies resort to becoming more selective regarding the projects they accept and are capable of handling.
If small construction companies do not act strategically and take on too many projects at a time, there is a danger that projects will not get finished on time or exceed the budget.
Sometimes, the person in charge of the construction works has to face more problem such as land issues, court cases, and another disaster cost, which makes it such an unpredictable area of job and investment.
4. Inadequate capital:
Construction companies rely on adequate working capital to pursue projects. The cash flow needs to be sufficient to fund projects while at the same time taking into account the profit margins.
If a construction company operates without enough money to invest in materials and pay staff, projects may get delayed which will not reflect positively on the company’s reputation.
It may even cause a problem in the future as the land or the incomplete structure is just abandoned for too many years, and that becomes a weary structure, which the construction workers have to rebuild in order to finish the project.
5. Environmental sustainability:
Like other industrial sectors that depend highly on fossil fuel, the construction company is also impacted by the need to reduce the negative ecological effect of industry practices.
Since environmental sustainability is a global priority, construction companies need to make significant changes to meet requirements set by regulating bodies and at the same time prevent backlash from the general population.
Becoming environmentally sustainable is not easy for a small construction company because it will also require some capital to change many of the standard procedures that have been around for many years. Since environmental protection is a social obligation, it is necessary for the management to approach the problem by focusing on specific ways that would lead to reducing the consumption of natural resources.
