Human Resource Management in Construction Week 1 Unit

Human Resource Management in Construction Week 1 – Unit Introduction and Construction Industry Business Context

Unit Purpose To provide the candidate with an understanding of the different approaches to managing human resources in the construction environment

Learning Outcomes 1. Review the changing nature of construction employment 2. Describe the nature and stages of a recruitment process within the construction environment 3. Describe the nature and methods of training and development of personnel in construction

Assessment Methods • Learning Outcome 1 – 1500 word report Learning Outcome 2 – 1500 word report and conduct an observed selection interview • Learning Outcome 3 – 1500 word

Assessment Dates • L 01 Report – 23/04/15 • L 02 Observed Selection Interview – 07/05/15 • L 02 Report – 14/05/15 • L 03 – Report – 04/06/15

Learning Outcome 1 – Review the changing nature of construction employment

Human Recourse Management Defined ‘. . a strategic and coherent approach to the management of an organisation’s most valued assets - the people working there who individually and collectively contribute to the achievement of its objectives. ’ Michael Armstrong ‘. . supporting corporate strategy by integrating business goals and people management ‘ Pemberton and Herriot , 1994 cited by Fryer, 2004

The Main Activities of Human Resource Management • Human Resource Planning • Recruitment and Selection • Learning and Talent Development • Employee Reward • Employee Relations – Grievance and Disciplinary, Dismissal, Redundancy • Employee Well Being • Managing Diversity • Managing Equal Opportunities • Provision of Contracts • Performance Management • Ethics Adding value to support the organisation to achieve its strategic objectives

Employment within the Construction Sector • Construction – one of the largest UK sectors and a key source of the UK’s added value and employment • Contributes £ 90 billion to the UK economy and covers 2. 93 million jobs equivalent to approximately 10% of UK employment • UK construction industry is more fragmented than European competitors and has higher level of sub contracting Source: UK Construction – An Economic Analysis of the Sector – July 2013 – Department for Business, Innovation and Skills

Small Group Activity Prepare a PESTLE analysis for the UK construction industry

UK Construction in the Global Economy Factors affecting demand for construction: • Globalisation • Demographic changes – healthcare and ageing population • Demand for green and sustainable construction • Increasing importance of technology • Construction businesses not fully aware of the benefits of exporting

Drivers of Long Term Growth (Slide 1 of 2) • Accessing foreign market and increasing export activity • Need for skilled and flexible workforce – need to inspire younger workers to the industry to replace lost skills • Difficulties of recruiting staff with the right skills, qualifications and experience • Access to finance – problems with late payments and awareness of funding available

Drivers of Long Term Growth (Slide 1 of 2) • Low levels of innovation and research and development • Consumer demand – preference for energy efficiency and high quality finishes • Offsite construction for minimisation of waste KEY ENABLER OF LONG TERM GROWTH IS PEOPLE

People and Skills (Slide 1 of 2 ) • Increasing demand for higher level skills – link to management and leadership capability • Identified skills shortages in skilled trades and professional occupations – impacts ability to compete • Need to encourage greater use of apprenticeships • Low volume of training and development

People and Skills (Slide 2 of 2 ) • Lack of established training plans • High number of self employed – ‘earn or learn’ dilemma • Management capability of project teams is a very important enabler of successful project outcomes • Continuing investment in the development of skills is vital • Appeal of the construction industry to young people is low

Factors currently affecting employment in the construction sector • Shift away from traditional work patterns • Increasing levels of self employment, subcontracting and temporary employment • Under representation of women and ethnic minorities • Increased use of low skilled migrant workers

Skills and Training in the Construction Industry 2014 CITB - Findings • • • The most frequent recruitment difficulties were for labourers and general operatives, wood trades and other skilled trades. The most frequently cited cause of hard-to-fill vacancies is that applicants lack the skills required (80%). Recruitment difficulties have had an impact on 90% of employers that have reported them. This impact is most likely to have been the increased use of overtime and higher workloads for existing staff (70%) The three areas in which skills and/or knowledge are most frequently reported as needing improving or updating as a result of the drivers are technical/trade-specific skills (33%), skills and knowledge related to health and safety/first aid (31%), and skills and knowledge related to legislation/regulations (30%). Of employers that provided training in the last 12 months, 50% provided training towards a nationally-recognised qualification. This is significantly higher than the 2011 figure of 33%.

Employment in the Construction Sector • High level of self employment – this allows organisations to manage risk and enhance organisational efficiency and productivity • Labour intensive industry • Increase in the recruitment of labour through subcontractors and intermediaries • Subcontractors tend to be smaller firms • High proportion of workers employed on temporary, casual and short term contracts linked to the concept of the flexible firm • Decline of the permanent, directly employed workforce • Increase in outsourcing – enables organisations to focus on management and coordination of projects

Employment in the Construction Sector • Employment on casual terms allows numerical flexibility – impacts skills development within the sector • Fluctuations in wages are commonplace in line with fluctuations in output and nature of seasonal contracts • More than half (53%) of employers in construction contracting sector reported skills shortages in professional or associate professional occupations and some 28% reported skills shortages in trade occupations. • Increase in the number of employees in construction contracting with a degree or equivalent qualification – 2001 – 12% - 2012 -22% • Fall in number of completed apprenticeships

Employment in the Construction Sector • High dependence on project managers – management capability is essential for the long term success of the construction industry • Industry is seen as less attractive than engineering

Contract Types in the Construction Sector – Forde and Mc. Kenzie, 2007 • Reliance on and use of contingent labour – detrimental impact on skills development and contributes to industry skills shortages • Workers on contingent contracts less likely to receive training? • Increase in agency contracts – allows screening prior to permanent employment

Reference Sources • http: //www. ons. gov. uk/ons/dcp 171766_374281. pdf Office of National Statistics • http: //www. som. cranfield. ac. uk/som/dinamiccontent/media/Wendy%20 Lewis/Research/Freelance%2 0 Workers%20 in%20 Construction%202 nd%20 Edition. pdf • http: //citbni. org. uk/CITB/files/0 d/0 dbe 3 a 08 -137 d-49 e 9 ad 48 -62 ddaaeb 6 a 91. pdf