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Industry admits human resource failings

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Construction and engineering chiefs have admitted critical failings in the way the industry looks after its people.

Thirty senior figures at large organisations put transforming human resource practices as more important than technological advance for the future of the sector.

The survey findings were revealed in a World Economic Forum report into the future of the construction industry worldwide.

Asked to score a range of ‘transformation areas’ out of five for importance, the industry figures gave ‘people’ 4.6; adoption of new technologies, materials and tools 4.5; and collaboration 4.2.

When they were asked to rate the existing engineering and construction industry on various performance criteria, they gave it an average below three out of five for strategic workforce planning, smart hiring and enhanced retention.

The industry was also given less than three for continuous training and people development; for knowledge management; and for incentive schemes.

It scored more than three for project planning; project management; and project monitoring.

The report said that only 57% of UK construction firms funded or arranged training for their staff in 2015. Only the agricultural sector had a lower figure.

Meanwhile, data from the US Bureau of Labor Statistics showed that more than one in five construction workers quit their job in 2014.

Skanska vice-president for information systems strategies Peter Bjork told the World Economic Forum: “Our business is really all about people. You can have equipment and financial resources, but to truly succeed in a business like ours you need to have the right people in the right places.”

Technological advance is also a key step in the transformation of the construction industry, according to the report.

“Compared to many other industries, the construction industry has traditionally been slow at technological development,” said the study.

“It has undergone no major disruptive changes; it has not widely applied advances in processes such as ‘lean’.”

The study said labour productivity in the US construction industry had fallen over the last 40 years.

“Looking at construction projects today, I do not see much difference in the execution of the work in comparison to 50 years ago,” said John Beck, executive chairman of Canadian construction firm Aecon Group.

The World Economic Forum highlighted the potential for advanced building materials to make the industry more efficient.

It said that a third of construction cost was due to materials, and the European Commission had estimated that 70% of product innovation across all industries was derived from materials.

“A large variety of innovative [matierals] are market-ready or close-to-market,” said the World Economic Forum. “Yet despite their great potential, they very often fail to penetrate the market, let alone achieve widespread acceptance.”

The study called for engineering and construction firms to create a database of evidence on the benefits of advanced building materials to convince clients with.

“Contractors should institutionalise the knowledge transfer to local project teams, so the decision-makers at a project level have all the relevant up-to-date information and can thereby optimise their decisions on materials,” it added.

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