Throughout the entire coronavirus affair, the question of whether construction workers are essential has ebbed and flowed. Initially, ministers wanted to keep sites open and the economy chugging along.
Then, following pressure from the public and scientific advisors, Boris Johnson’s cabinet decided to close them temporarily, believing the risks of keeping them open outweighed the benefits.
Now, though, builders are once again making their way back to construction sites after a considerable hiatus. Whether the industry can recover from the collapse in demand for its services or the interruption in its cash flow remains to be seen.
On April 26, ministers announced their plans to allow the construction sector to reopen ahead of the rest of the economy to limit the anticipated economic fallout from extended closure.
The measures implemented by the government on March 23 appeared to prohibit any commercial activity on building sites, but those restrictions were reviewed and partially lifted last week.
Taylor Wimpey And Other Construction Companies To Reopen Sites
Construction giants, including Taylor Wimpey and Persimmon, have welcomed the move. Both companies said that they would be reopening a host of sites across the country in the coming days, helping thousands of workers return to work after weeks of furlough and uncertainty.
The drive to get the construction industry back on track as soon as possible follows concerns among contractors and major operators that significant job losses could follow an extended shutdown. Construction tends to lead the rest of the economy into a recession.
It takes longer to recover, so the government is keen to give it a head start relative to other industries.
The public health data also appear to support the idea that construction sites should reopen early. The government’s advisors believe that transmission of COVID-19 is less likely in outdoor environments.
Construction workers assigned to the majority of UK projects, therefore, will likely face lower risk, so long as social distancing rules remain in place.
The move to reopen construction is the first indication that the government is keen to get the economy moving again. In recent weeks, the conversation has shifted from dealing with the immediate issues of lockdown to discussing the UK’s “exit strategy” – how the government plans to get people back to work.
Public health officials, such as Sir Patrick Valance and Professor Chris Whitty, want a graduated, phased approach. They argue that the opening of the economy should be piecemeal, based on thorough assessments. If the benefits of opening up a particular sector outweigh the risks, then it should go ahead.
Ministers, therefore, believe that industries where social distancing is feasible, like construction, will open up sooner rather than later. Sectors that rely on people being in close proximity, such as restaurants and hospitality, will likely take much longer to return to business as usual.
Taylor Wimpey became the first business in the construction sector last week to announce plans for how it will implement coronavirus safety measures on its sites. Arrangements have been in the works for several weeks in consultation with the government.
Pete Redfern said that his company had been in regular contact with Number 10 and the Treasury to discuss when work might get back underway.
The main concern of public health officials was how to maintain social distancing while carrying out work on building sites. The nature of the work means that keeping a two-metre gap between colleagues on-site might not be possible.
Taylor Wimpey said that it was looking into supplying all of its crews with personal protective equipment as soon as it becomes available.
As the construction sector opens up, the demand for ancillary services will begin to rise, potentially providing additional employment opportunities for millions of sole traders. There will be a rush to get full electrical, plumbing, and scaffolding public liability insurance as new opportunities become available sooner than many expected.
Other Sectors Of The Economy May Reopen Soon
Ministers are also under pressure to allow other sectors of the economy hard hit by the coronavirus to open up. Garden centres, for instance, opened their doors this week and immediately put on massive sales in an attempt to dump more than £200 million of unsold plants onto the market.
For weeks, critics of government policy have pointed out the clear divide between the treatment of supermarkets and that of other retailers. Companies like Tesco, Asda and Sainsbury’s have been free to sell bouquets to customers getting their food shopping, but garden centres have not.
The saving grace for garden centres could be that they are a relatively low-risk environment, like the construction sector. Shoppers usually make their way around in the open air or large tents, reducing the risk of transmissions.
Furthermore, garden centres are often large installations on the edge of town, making it easier for shops to maintain strict social distancing protocols.
There is evidence that the UK economy is opening up even further. B&Q, for instance, is now open to trade customers, providing a vital resource for the thousands of sole operators who rely on it every day. Vast areas, however, will remain closed for some time to come.
The Long-Term Economic Fallout Of Shutdown
The long term ramifications of the government’s policy are not yet clear. Currently, there is a case for opening up more of the country because the NHS can still take additional coronavirus patients.
Ministers and their advisors, however, face a tricky situation. On the one hand, they need to get trade moving again to protect the future, but on the other, they don’t want to risk a second wave and more deaths.
The UK has not had a trial run for an eventuality such as this, and so there is no guarantee that the results will be favourable. The economy could bounce back next year. Equally, though, we could be headed for a depression that destroys the life chances of millions of people.
The death toll in the UK is now believed to be above 40,000, more than twice the figure Sir Patrick Vallance – the government’s chief scientific advisor – said was optimistic.
It seems very likely that the number will continue to rise in the coming weeks and months, perhaps topping 100,000 when all is said and done, assuming we do not have a second wave.
Politicians, however, need to think very carefully about the decisions that they make regarding the economy in the coming months. While people dying from COVID-19 is a tragedy, so too is the loss of businesses, livelihoods, and mental health.
The fallout from a catastrophic recession could theoretically lead to more untimely deaths than if the pandemic was allowed to follow the natural course.
Government ministers are keen to point out that they are doing their “homework” when it comes to reopening the economy. But they stress that they cannot speculate on the form that individual measures will take.
They will likely introduce seemingly confusing rules, designed to balance costs and benefits against each other. The piecemeal approach, therefore, will continue for some time and may change as new evidence arrives.
The government’s exit strategy and approach to the virus could change as economic conditions worsen. Currently, they have the luxury of time and a stable currency.
If borrowing and money printing continue long-term, though, it could threaten the economic future of the country. At that point, risking a few more coronavirus deaths could be the only way to preserve their power base and essential public services.
Whether decision-makers fully understand the ramifications of shutting the economy for several months is not clear. The objective currently is to limit the number of deaths from coronavirus.
The rational approach, however, is to adopt policies that minimise total untimely mortality, both from COVID-19 and all other causes. Shutting down the economy implies enormous costs both now and in the future.
The longer businesses remain closed, the fewer opportunities there will be to make progress economically. There will be less funding for medical care and research – both of which are crucial for keeping people healthy in the future.
As other countries around the world begin to open up their economies, calls from British business will get louder. Bosses will want to restart operations as soon as possible, even if the government is paying their furlough bills.
Companies are already running low on cash and highly indebted. The state might be covering worker salaries, but it is not providing across-the-board support for all their costs. Extending the furlough scheme is only part of the solution. Without revenue-generating activities, many companies will fail, and it will hit workers badly.
Unions remain concerned that construction sites are set to reopen – a factor which could significantly slow the process. Unite, for instance, warned that it would not accept construction companies putting worker health and safety at risk on sites.
It claimed that the industry was trying to water down official social distancing guidelines in an attempt to boost profits. Bosses, in its view, were putting the viability of their enterprises ahead of worker health.
