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Productivity losses rise to 35% on UK construction sites

24 Jun 20 The impact of the Covid-19 lockdown is causing productivity losses of around 35% on UK construction sites, research indicates.

Extensive programme delays and spiralling costs caused by temporary site closures in March and April have exacerbated the sector’s underlying performance problems. 

According to new productivity research developed by surveying firm Turner & Townsend, the uncertainty of whether labour will arrive on site, social distancing measures and material delays are compounding the productivity gap.   

Turner & Townsend’s Suiko consultancy division analysed data from 70 medium-sized UK construction projects. It modelled that a £20m commercial real estate project with an 81-week programme before the pandemic would typically suffer productivity losses of 20%. Now, a project of this scale is seeing this rise to 35% productivity losses with project completion delays of up to 32 weeks and increases of around £600,000 in preliminary costs alone.

The Suiko team analysed pre-Covid-19 data across 70 historic commercial real estate projects to measure the common issues that lead to poor productivity including resource, design, planning/management, material and equipment efficiency, client decision making and weather.  Suiko then assessed these factors by analysing 45 current commercial real estate projects as well as considering the impact of Covid-19 social distancing measures and material delays in 50 locations worldwide.   

Analysis of the 45 current projects delivered during the pandemic reveals that labour shortages together with the impact of social distancing is accounting for around 7% productivity losses. A further 1& is being lost through the poor transfer of design information while remote working. In addition, late material deliveries or unavailability is leading to another 7% loss.

Although some shortages have been addressed, pinch points in the domestic supply chain are continuing to impact productivity, with delays being reported in deliveries of plasterboard and aggregates.

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Turner & Townsend principal consultant Stephen Gallagher said that poor planning and inefficiency was a major contributor to the problem: “UK construction has systemic productivity challenges. In particular, the final phases of a project are typically the most inefficient as contractors are often behind schedule and must throw extra labour at sites to try and get buildings finished on time. This usual fix will not be possible with social distancing and reduced labour.

“In the age of Covid-19 the internal fit-out phase is the most challenging because numerous trades are working on site (often out of sequence), and there is a high volume of and variety of materials arriving to site.”  

In response, Turner & Townsend has added its voice to those saying more technology and offsite manufacturing are the answer.

Stephen Gallagher said: “Boosting construction’s productivity is key to supporting the UK’s wider economic recovery. With low productivity and low margins, the construction sector has poor resilience to weather the immediate and long-term consequences of COVID-19 on the economy.

“Short-term, the sector needs to look at whether it can recover lost productivity on site through smarter working practices. Lean can help increase productivity whilst dealing with lower resource levels, by removing large amounts of process ‘waste’. Planned versus actual progress can be demonstrated in three dimensions using photo-realistic representations of activity on site and validated using the contractors’ 4D schedule in order to increase efficiency. By embracing modern methods of construction, the Covid-19 impact on resource levels can be mitigated by taking processes off site.  These solutions have been present for some time, but their adoption is now urgent. We need to see a complete mindset shift to close the productivity gap.”

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