The Secretary of State for Business, Innovation and Skills (Vince Cable)
The Government have today published the “Industrial Strategy for Construction”, which has been produced in partnership with stakeholders from across the industry.
Last September I set out the Government’s new industrial strategy. This is a long-term, whole of Government approach that has partnership with industry at its heart. Its purpose is to establish a clear and consistent approach to the challenges and opportunities that lie ahead, with a view to stimulating economic growth and creating jobs. Today’s construction strategy is one of 11 focusing on key economic sectors.
Construction accounts for nearly 7% of the UK economy’s gross value added, comprises over 280,000 businesses and provides 3 million jobs, equivalent to about 10% of total UK employment1. It has been hard hit by the recession, with output in the private housing market having fallen 40% and private commercial building over 30% since 20072.
The strategy identifies three strategic priorities for growth over the next decade. First, smart construction and digital design, where construction companies stand poised to secure a significant portion of the projected £200 billion annual global market for integrated city systems in 20303. Secondly, low-carbon and sustainable construction, the global industry for which is forecast to grow at an annual rate of 22.8% between now and 20174. Thirdly, the significant opportunities to improve UK trade performance and capitalise on forecast growth of over 70% in global construction between now and 2025.
This strategy sets out a vision for UK construction in 2025 and outlines four ambitions that will be jointly delivered by industry and Government:
A 33% reduction in both the initial cost of construction and the whole-life cost of assets
A 50% reduction in the overall time from inception to completion for new build and refurbished assets
A 50% reduction in greenhouse gas emissions in the built environment
A 50% reduction in the trade gap between total exports and total imports for construction products and materials
The newly formed Construction Leadership Council will develop an action plan on how to put these ambitions into effect between now and 2025. Activity will focus on delivering the 10 commitments set out in the strategy around supply chains, innovation, skills and image.
We are also publishing two pieces of economic analysis alongside this strategy. These are:
“UK Construction: An economic analysis of the sector”— this BIS analytical paper provides an overview of growth, competitiveness and performance in the UK construction sector, including skills, access to finance, innovation and supply chain developments.
“Trade credit in the UK construction industry”—a study of the availability of trade credit to UK construction firms and their reliance upon such trade credit to support their operations.
These provide a strong evidence base for the industrial strategy.
Copies of the industrial strategy for construction, and the other documents mentioned above, will be placed in the Libraries of both Houses.
1BIS Analysis of labour force survey micro data, non-seasonally adjusted for wider construction sector.
2ONS annual business survey, February 2013 release.
3Technology Strategy Board estimate.
4IbisWorld report: Top 10 fastest growing industries, April 2012. The global green and sustainable building constructing is estimated to grow from about $103 billion in 2012 to about $288 billion in 2017.