Challenges faced by the Construction Industry

Despite the last 12 months of the COVID pandemic having extreme effects on several areas within UK business, the construction industry has remained fairly stable in its production output. With the freedom to work outside or in air-rated spaces and socially distance from other colleagues, the industry has found opportunity to continually operate within their means. However, at the same time they have incurred other difficulties.  Struggles to source materials and the mark of Brexit has led to many EU construction workers leaving the UK has created other challenges for the Construction Industry.

Building employment within the Construction Industry

Brexit has caused labour levels to drop, following the departure of many EU construction workers who have returned to their home nations. With new immigration rules, set to be a problem for recruitment and migrant worker eligibility, a labour shortage could affect companies and their level of output in going forward.

In response to this, the UK government are encouraging construction companies to look towards apprenticeships as an alternative method to employing low-cost labour whilst creating skills at the same time. This will allow more young people to become proficient in trades and give them confidence when embarking on their first job. An apprenticeship combines practical training in a job with opportunity to study and gain a qualification. Under the “Build Back Better” scheme, the UK Government is committed to providing employers with a hiring incentive for each new apprentice they hire. A sum of £2,000 is available to businesses for every apprentice hired aged 16 to 24 and £1,500 for those aged 25 and over.

Levelling up employment pay within the Construction Industry

When hiring contractors and apprentices, it will soon become mandatory for construction companies to adopt the IR35 tax also known as ‘Off-Payroll Tax’. The new tax, which is already implemented in the public sector, is set to come into force for the private sector as from the new financial year – April 2021.

The tax has been introduced to tackle an escalating employment problem in the UK. Over recent years, it has become common practice for companies to approach workers for regular work but hired on a self-employed basis. They have done this to avoid paying extra tax and NI yet have had them work for them full-time. These types of employees became known as ‘deemed employees’.

Under the new tax scheme – Off-Payroll Tax, companies will have to assess the status of the contractor and pay employment taxes on top of the fees paid to the contractor which will be treated just like a salary.

Protecting employees and businesses within the Construction Industry

It is critical that construction companies protect both business operations and individual in which they operate. JRW Risk Solutions provide commercial liability insurance cover to the construction industry, across the West Midlands and the UK. Including employer’s liability, cover for contractors and public liability cover, we protect both people and businesses. Whether working as a standalone contractor or operating as a much wider scale construction business who employs tradesmen and women. JRW Risk Solutions go further to protect construction companies with construction insurance cover. To find out more, please contact us or see our commercial insurance website for more details.

To find out more about apprenticeship for your construction business, please visit:

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