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Construction industry trends to watch out for in 2022

There’s no denying that the last couple of years have been turbulent for the construction industry. With COVID-19, Brexit, changes to building regulations, a heightened pressure to adopt green methods, and materials and labour shortages, many have described the current conditions as “the perfect storm”.

However, difficult times often lead to heightened investment and innovation as businesses look to differentiate themselves and demonstrate a positive impact on the world. So, we expect to see firms taking tangible steps that are both bold and innovative in order to reach net-zero targets. Modern methods of construction (MMC) are also being recognised as solutions to increase productivity and tackle the shortages across the industry.

Many of the challenges that construction is facing will not be left behind in 2021. Nonetheless, they also present a multitude of opportunities for industry professionals, so we’ve collated the top trends to watch out for in 2022…

The adoption of a whole-life mindset

The construction sector forms a substantial portion of UK carbon emissions and for a long time, operational carbon accounted for most of this. However, there has been a shift over the past couple of decades as buildings have become more efficient to operate.

Part Z is a proposed amendment to the Building Regulations which introduces the requirement to assess whole-life carbon and limit embodied carbon emissions in built assets (essentially, it aims to minimise the carbon footprint of the production and use of construction materials in a building). Recently, the proposed amendment has gained support from industry giants such as Morgan Sindall, Laing O’Rourke, Landsec and Lendlease.

The shift in attitude and growing support of the proposed amendment will likely lead to changes in the way we construct built assets over the next couple of years. It is forecasted that throughout 2022, we’ll start seeing more wide-spread investment into new materials, fire-safety research, and more efficient ways of working which will start to level the playing field for construction firms who want to commit to positive change, but are held back by others in the industry.

The heat is on for renewable energy

The fact that more companies have committed to limiting operational carbon is clear when we consider heat pump sales across Europe, which grew by +7.4% in 2020, with 1.62 million units sold across the continent.

In 2022, this figure is expected to increase further, not necessarily out of choice, but out of necessity. Under Part L1A of the Building Regulations (which looks at the conservation of fuel and power), building a new home in the UK will come with extra energy-efficiency requirements. The changes to Part L state that there will be a maximum flow temperature requirement of 55°C for new and replacement heating systems, meaning that more renewable heating systems must be used.

To incentivise this, last year the government announced the Boiler Upgrade Scheme, which launches in Spring 2022 and offers homeowners a £5,000 grant to help them transition to low-carbon heating systems. However, following the Green Homes Grant which was branded a "massive flop” by MoneySavingExpert.com founder Martin Lewis, it will be interesting to see how much impact this has on the market during 2022.

Upskilling the workforce as vacancies hit all-time high

Construction has grappled with shortages of skilled workers for years, but Brexit and Covid have exacerbated these problems. In September 2021, The Office for National Statistics found that 43,000 jobs were unfilled across construction – the highest volume of vacancies in the sector for over two decades.

However, large organisations have begun implementing wide-reaching training initiatives, for example, Morgan Sindall introduced ‘the Knowledge Quad’ which creates an essential link between the industry and education providers to ensure that curriculum aligns with employer requirements. In 2021, the Ministry of Justice also published a white paper that outlined plans to give prisoners better education, including vocational qualifications, with construction named as one of the fields in which they could be trained.

Filling 40,000 vacancies is a tall order. But with industry giants and government initiatives inputting both creativity and heavy investment to help to plug these gaps in employment, it’s the perfect time for the sector to embrace a more diverse workforce, and will be an exciting one to watch.

Tackling materials shortages with MMC

The shortage of materials due to the pandemic and difficulties securing HGV drivers have caused havoc across the sector. In fact, overall, construction material inflation was more than 23% in August 2021 compared to 12 months prior.

However, heightened demand and inflation are forcing businesses to reconsider their processes. This means that modern methods of construction, such as offsite manufacturing, will grow as a result. In 2021, Savills predicted that the proportion of new housing developments built using MMC would increase from the current 6-10% to 20% of the market in the coming years.

This is because factory environments allow more precision when calculating material quantities required and enable waste to be more easily controlled than on a traditional building site. In fact, the Buildoffsite report estimates that the cost of remedying construction defects onsite adds around 2% to an onsite project’s overall cost, while waste amounts to 3-5% of overall costs. In contrast, the costs for offsite manufacturing are close to 0% for remedying defects, and 1-3% for waste costs, demonstrating a substantial saving.

So, although materials shortages are not going anywhere, these realisations could give firms a much-needed push to adopt more modern ways of working during 2022.

Looking ahead…

Despite the unquestionable challenges posed, the more responsibility the construction industry takes, the more we can ensure that new regulations effectively deliver safety, promote innovation and raise standards beyond the minimum.

As we look ahead to 2022, we should be optimistic that the sector will take the necessary steps to implement more sustainable and innovative solutions moving forward. And for those with mindsets focused on innovation, diversity, responsibility and collaborationthere is no doubt that the future remains bright.

What are your predictions for the construction sector in 2022? Drop us a line here or send us a tweet to @RefreshPR!

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