Decarbonisation - do we have capacity?
Decarbonising the nation's homes requires an immense and multifaceted retrofit effort. Is the construction sector sufficiently skilled to deliver it?
A question asked by Construction News. Tens of millions of homes need to be turned green – a huge task and a great opportunity for construction, but it needs about half a million more builders, tradespeople and roles by 2035 to deliver the government's ambition of decarbonising residential stock to EPC band C.
Q. What is the current situation?
A. The Construction Leadership Council reported there are fewer than 2% of the workforce required and the West of England Combined Authority found in 2021 that it would need a 48-fold increase in solid wall insulation jobs to hit a 2030 net-zero target. This picture becomes more complicated when considering all tenures, because the skillsets, funding and market forces are different for each type. It is estimated that of the 29 million homes needing to be upgraded, 64% were owner-occupied, largely served by small and micro building businesses – the so-called 'white-van man'. While the social sector (17%), served by major contractors, has the most-ready access to finance, and needs these skilled workers now. Privately rented homes account for the other 19% of stock in need of retrofit.
This shows how little progress has been made since the Climate Change Act 2008 (2050 Target Amendment) Order 2019 to equip the construction industry to deliver the UK’s net zero carbon objectives. There are not enough people with the necessary retrofit skills. This is compounded by the shortage of skilled tradespeople the industry is already trying to recruit for general repairs, maintenance and building work as a result of an ageing workforce, people leaving the industry and fewer European tradespeople.
Q. Where are the shortages?
A. It is estimated that more than 250,000 new construction-related roles are required for retrofit by 2035. In addition, over 230,000 of the existing workforce needs to be retrained and a further 230,000 jobs are needed in retrofit-related supply chains. Key areas where there is an acute shortage include:
- Retrofit designers (together with assessors, coordinators, advisors and evaluators) – The Retrofit Academy has identified these five roles to ensure projects meet the PAS 2035 quality standard.
- PAS 2030 accredited workers, such as those required for EWI and IWI.
- Heat pumps installers (30,000 more needed by 2028), about 1,600 listed on the MCS database. However, some consider this increase is plausible because it represents just a fraction of the 130,000 registered gas boiler installers.
Q. How could these shortages be met?
A. While main contractors are taking practical steps to help their supply chains achieve the PAS 2030 standard by promoting its importance, there is less progress in the wider industry, such as smaller builders and firms. Some believe the construction industry needs to be recast as a ‘solutions provider’ for modern problems (cost-of-living, energy and climate crises). Such messaging could attract youngsters, encouraging more to consider working in construction. However, it is not easy to find the right courses for new recruits because the roles are quite different from those of traditional carpenters, joiners, or plasterers. It requires schools and colleges to put on a whole new raft of courses. In addition, PAS 2030 and 2035 accreditation is onerous for an industry already struggling, not being able to recruit enough skilled tradespeople for its normal work and meet client expectations.
Q. What funding is available?
A. While the Government is funding some decarbonisation work through the SHDF (£6.8bn announced in 2019) and Green Home Grants (closed to new applicants). In 2022, it pledged a further £6bn from 2025 to help social landlords green their existing homes. This requires match-funding from social landlords. It is also offering grants of £5,000 for home owners to install air source heat pumps (£6,000 for a ground source heat pump) rather than gas boilers but the amounts do not cover the additional costs, compounded by not enough accredited heat pump installers. The SHDF funding creates a demand for retrofit but does not help the recruitment and training of the skilled retrofit workforce required to do the work. While some government funding is available for retrofit training and the Retrofit Academy is working with regional authorities to develop the courses, recruit students and for them then to be trained, this takes time. Recruitment and training cannot be a quick fix to the shortage of skilled and certified retrofit workers the industry needs.
Q. What challenges are there?
A. The main challenge is that the shortage of an adequately sized, skilled, and certified retrofit workforce cannot be fixed quickly. A long-term, adequately funded recruitment and training programme is required if the UK is to achieve its aim of decarbonising existing housing. This needs to be supported by consistent government policy, whoever is in power, to encourage the industry to invest in recruitment and training. It will only do this, if it knows the investment will be worthwhile because the demand will be there.
Another challenge is the need to persuade people, especially homeowners, that retrofit is the right thing to do and makes economic sense. Consistent messages by the media as well as government are needed. While the immediate need was to subsidise energy bills during the energy crisis, the long-term solution is to reduce demand by improving the energy efficiency of existing homes. Such messaging could encourage more young people to be interested in the construction industry, particularly retrofit or decarbonisation or green solutions.
Q. Is there any hope? What opportunities are there?
A. While the scale of the challenge, decarbonising about 29m homes, is immense, there is an increasing recognition that this work needs to be done. This will generate both a demand and an interest to undertake this work in all tenures, an opportunity for the construction industry – both major contractors and ‘white-van’ men. Those businesses that have invested in the retrofit training required will be able to capitalise on these business opportunities. Can government and industry work together to achieve our net zero carbon goal?
The NHMF would like to thank Tyron Stalberg, Bid Director, Vinci Facilities and a member of the NHMF Service Provider Forum for his assistance in preparing this Bulletin.
