Construction sector warned to ‘tread carefully’ post latest Brexit news

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Brexit news

The latest Brexit news has advised the government to restrict lower-skilled EU workers and warned the UK construction industry to ‘tread carefully’ to avoid damaging business

The advice comes from construction insurance expert Mark Herbert following the final Brexit report from the Migrant Advisory Committee (MAC) which urges the government to restrict the amount of lower-skilled migrants coming to Britain after the country leave the EU.

Construction site workers fall into the ‘lower-skilled’ bracket, which if restricted could pose a threat to industry recruitment with a knock-on effect to trade and overall profitability in the sector.

The construction sector has always relied heavily on EU continental workers to make up a skilled workforce.

There are estimated to be more than 120,000 EU migrants currently working in the industry.

To lose migrant workers would dramatically increase the cost burden for UK building firms who would need to recruit and train domestic workers to replace the EU nationals.

Construction sector bosses have voiced growing concerns over the impact of a hard Brexit on their companies and insurance expert Mark Herbert has been offering Britain’s first Brexit Insurance consultations to help ease worry in the industry.

Following the Brexit news, Mark has advised the firms to ‘play it safe’ and to ‘tread carefully’ whilst Brexit negotiations are still taking place; he said: “The construction industry is certainly holding its breath at the moment and there is a real air of doom and gloom in the sector as everyone is being kept in the dark and is looking for answers.

“One of the main concerns for UK construction firms is that instead of using foreign workers they will start having to increase their costs by training up domestic workers. They are also likely to have an increased wage burden as they are forced to use higher skilled UK contractors to plug the gap.

“Companies should take steps to protect themselves against Brexit to stop their turnovers plummeting and the best way to do this is to continue with projects that are within their remit, and stick with safe work that they know they can handle comfortably.

“Whilst Brexit negotiations are taking place it is best to avoid taking on larger and more ambitious acquisitions. If you take on newer, bigger contracts now then firms risk not finishing jobs. It is best to play it safe whilst we find out exactly what the outcome of Brexit will be.

“Firms are also facing uncertainty over wage roll structure due to the changing status of who they employ and they need to make sure their insurances are up to date and correct.

“Luckily there are steps companies can take to minimise impacts and Construction Insure can look at wages and turnover and let them know if they are insured correctly.

“We can also look to forecast what possible change these Brexit impacts may have on their insurance premiums.

“Many contractors do not understand the different type of labourers they use when trying to identify who relates to what on payroll breakdown for insurance purposes. This is crucial information which dictates premium and if gotten wrong can void policies or create huge additional premiums.

“It’s an even bigger risk when trying to purchase a policy online where the client may be tempted to bypass certain questions just to get a cheaper premium. This is an easy trap to fall into but can have dire consequences.

“Construction insure speaks to each client and defines to them what is a manual, labour only and a sub-contractor wage roll and ensures the clients policy has been rated correctly.”

See the full Migration Advisory Committee (MAC) report: EEA Migration here – published 18 September 2018.

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