Why Rachel Reeves should give builders a tax cut to employ the next generation of apprentices

Rachel Reeves has banked on planning reform to grow the economy, but without a new generation of bricklayers, carpenters and electricians, her ambitions will fall short.

New research published this week by the Centre for Social Justice (CSJ) shows the extent of Britain’s construction workforce crisis. There are over half a million fewer construction workers today than at the time of the financial crash in 2008, and over a quarter of a million fewer than before the pandemic in 2019. Construction’s slice of the UK workforce has shrunk to a 100-year low, not seen since the time of the Great Depression.

Without reversing these trends, the government will be unable to build 1.5 million new homes.

We will need an additional 161,000 workers to meet this manifesto promise – rising to over 239,000 once factoring in wider construction demand by 2030. Some forecasters put the true figure at one million.

This scale of recruitment is unprecedented and will be a monumental challenge for the construction industry. Skills shortages already cripple the sector, and thousands of workers are on the cusp of retiring. Yet, our nation’s future economic growth depends on it.

Earlier this year, the Office for Budgetary Responsibility (OBR) announced that planning reforms could add billions to the economy – a forecast enthusiastically welcomed by the chancellor. However, the detail buried in the small print tells a more sobering story. The OBR state bluntly that growing demands on a limited construction workforce could hinder housebuilders’ ability to deliver a rapid acceleration in the flow of new houses.

Reeves will no doubt point to the government’s planning reforms as a sign of its commitment to growth. But this alone will not be enough. Consider our aging workforce. One in three builders are now over the age of 50 – up from just over one in four 17 years ago. The number of 16–24-year-olds, meanwhile, has collapsed by over 150,000 since 2008. Bob the Builder is retiring, and he has no apprentice.

Don’t get me wrong – planning reform is an essential component of fixing this problem. How can housebuilders invest in jobs for young people when their pipeline is subject to countless delays, reassessments and uncertainty? But despite the government’s loud commitment to ‘build, baby, build’, cut through the noise, and every builder will tell you things haven’t been this bad since the financial crash.

Steve Reed needs to go further and faster on planning reform by making the default answer to acceptable development ‘yes’. We recommend using design codes to fast-track beautiful development across the country, so if you meet the right standards, you can build. No more interfering by NIMBY councils.

But to scale-up the workforce quickly, we need to give construction firms the confidence to invest in the next generation. We have the people, they just lack the opportunity. Last year, approximately two in three learners graduated a construction course and did not find work in the industry. A shocking near 10,000 became unemployed. Calls by bosses for extra migration must be resisted when the pipeline into work for young Brits is so leaky.

Read more:

• Millionaires tell Rachel Reeves: Tax us more or lose to Reform in the next election
• How Labour’s new Skills England can save the construction industry and fix the housing crisis
• Labour’s apprenticeship reforms aim to train the next generation – but do they go far enough?

Instead, the chancellor should use the autumn budget to announce a future workforce credit, to get young NEETs (not in education, employment or training) into construction. This would cover 30% of the annual wage of anyone who has been NEET for three months or more, a massive effective tax cut to help builders employ the next generation of apprentices, paid for by reforms to out of control health benefits.

Rachel Reeves faces a daunting task, but there are levers to pull that would get spades in the ground, the economy growing, and create opportunity for thousands of young people looking for work. Planning reform is essential, but without concrete action to recruit, train and nurture a new generation of ‘tradies’, Britain will simply not get building.

Josh Nicholson is a senior researcher at think tank Centre for Social Justice

Do you know more about this story? Email Big Issue reporter greg.barradale@bigissue.com

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