Impact of the 2012 Olympics on the Construction Industry - Essay Example

Introduction In July 2005, the International Olympic Committee announced that London would host the Olympics and Paralympics. While this announcement has provided a boost to the construction industry in Britain, there are serious concerns about skill shortages in the industry. This paper focuses on the issues pertaining to skill shortages and whether the construction industry has the capacity to complete the projects for the Olympic games in 2012. The first part of the paper discusses scale and impact of the 2012 Olympics on the construction industry. The second part focuses on the construction industry in Britain and its problem of skill shortage. The last section, using a report by international project and cost managers, Gardiner and Theobald titled, 'London Wins 2012 Olympic Gamesbut Don't Panic.' illustrates why the British construction industry can meet the Olympics challenge (The report can be viewed at the Gardiner and Theobald Website at http://www.gardiner.com/NewsSystem/newstext/Olympics2.pdf) Impact of the 2012 Olympics on the Construction Industry London will be the host city for the 2012 Olympic games. The games will be held in 33 venues across London and the UK. Construction work is complete in just 18 venues. The rest have to be built from scratch or will require major renovation prior to the Olympics .The centerpiece of the games will be the Olympic park in London. According to the Chartered Institute of Builders (CIOB) Position Statement on the London Olympics 2012, the Construction Products Association estimates that the Olympics will generate 10bn of investment in Britain, 2.5bn of which will be construction related. The CIOB statement also states that Consultancy Deloitte estimates about 12,000 jobs will be created in the construction sector. (The CIOB position statement can be viewed at http://194.217.225.164/media/CIOB-PS-LondonOlympics2012.pdf) In its effort to meet the Olympic challenge, the Government has been warned that skill shortages in the British Construction industry could pose a significant problem. The Construction Industry in Britain The Department of Education and Skills has said that the construction industry needs around 88,000 new entrants every year in craft, technical, professional and management roles. In a press notice, it has stated that according to the National Employer Skills Survey (NESS) 2004, there are over 32,000 vacancies in the industry, 13,700 of which are skill shortage vacancies. In order to develop construction skills for major projects associated with the Olympics, a National Skills Academy has been set up. (The press release can be viewed at the Department of Education and Skills website at http://www.dfes.gov.uk/pns/DisplayPN.cgipn_id=2005_0129) According to a survey conducted by the CIOB, 89% of respondents felt there was a shortage of training placements in Britain. They felt that one of the prime causes for the construction skills shortage was the poor image of the industry, which was competing with several newer and more attractive industries. Besides these, they felt that certain policies pertaining to new-entrants also resulted in skill shortages. (The CIOB press release on skills shortage survey can be viewed at http://www.prnewswire.co.uk/cgi/news/releaseid=151701) The construction industry often reflects the economy itself. Just like the economy, the construction industry too goes through phases of robust growth, stagnation and even depression. During a lackluster period, skilled workers become redundant and are often forced to seek employment elsewhere or even switch professions. However, when the industry starts to look up, there is again a need for trained people, thus leading to a skill shortage. The Huntsman Associates report titled 'Staffing the Construction Industry in the North East' discusses the nature of the construction industry and the availability of skilled professionals in Britain, especially in the northeast region. This report emphasises on factoring this boom/bust nature of the industry while recruiting professionals. The report says that in boom periods employers can offer special employee benefits. (The Huntsman Associates - General - Staffing the Construction Industry in the North East can be viewed at http://www.constructionmall.com/press/article/12904) The Huntsman report mentions that "access to further training and qualifications" is also significant for employees. To cater to this, many employers offer graduate programs where second and third-year students can gain on-site experience as a junior. Effective safety policies, focus on team building, and good workplace facilities can attract young people into the field and improve the image of the industry. Also as the deputy Chief Executive of the CIOB, Michael Brown says, the Olympics could serve as the perfect vehicle to promote a career in construction. He believes that "if we can harness the imagination that the Olympics create then we have an excellent chance of recruiting new entrants into the industry." Can the Construction Industry rise to the Challenge The construction industry is very upbeat and the Gardiner and Theobald's report titled, 'London Wins 2012 Olympic Gamesbut Don't Panic' states that the Olympic challenge may be well within its capacities. In the run up to the Olympics, the report says, the construction industry will grow at 0.3% to 0.6% a month. This figure is not extraordinary as the industry has already been growing at0.7% per month for the last 7 years It also points out that a significant portion of the 6 Billion allocated to transport and infrastructure related projects would have gone ahead despite the Olympics. Also, some major ongoing projects are coming to a close around now. The report emphasises that the construction market can handle the problem of skill shortage by taking in workers from the European Union. (The report can be viewed at the Gardiner and Theobald Website at http://www.gardiner.com/NewsSystem/newstext/Olympics2.pdf) The Olympics may prove to be the construction industry's most powerful marketing tool. Initiatives like the National Skill Academy, earn while you learn schemes for employees, special benefits and attractive packages for trained personnel can help attract talent back into the industry. Shortage in skills can also be addressed by taking it workers from nearby European countries. In conclusion, it can be said that the next 7 years to the Olympics will be extremely hectic for the construction industry. Skill shortage may remain an issue but it can be handled to successfully meet the Olympic challenge. (1000 words) References: British Broadcast Company, (2005) Job optimism follows Olympic win, Retrieved on 1st November 2005 at http://news.bbc.co.uk/1/hi/uk/4658529.stm Chartered Institute of Builders,(2005), London Olympics 2012, The CIOB position statement, Retrieved on 1st November 2005 at http://194.217.225.164/media/CIOB-PS-LondonOlympics2012.pdf Department for education and Skills, (2005), Employers to drive new skill Academies, Retrieved on 1st November 2005 at http://www.dfes.gov.uk/pns/DisplayPN.cgipn_id=2005_0129 Gardiner and Theobald, (2005), London Wins 2012 Olympic gamesbut Don't Panic, Retrieved on 1st November 2005 at http://www.gardiner.com/NewsSystem/newstext/Olympics2.pdf. Huntsman Associates (2005) - Huntsman Associates General - Staffing the Construction Industry in the North East , Retrieved on 1st November 2005 at http://www.constructionmall.com/press/article/12904) National Federation of Roofing Contractors (2005), Roofers go for Gold as Olympics Comes to London, Retrieved on 1st November 2005 at http://www.nfrc.co.uk/NewsDesk.aspxID=94 Read More