The impact of coronavirus on UK's Construction Industry

Updated: May 30, 2020

Coronavirus has a dramatic effect on many businesses all over the world. The construction industry is going through a severe fall due to the COVID-19 pandemic attack, and many construction business owners beside facing the uncertainty of what the future will bring, they are also facing a major loss.

COVID-19 is an infectious disease caused by the most recently discovered coronavirus that originated in Wuhan, China, in late 2019. It has now spread to more than 170 countries and territories around the globe and infected more than 3,000,000 people.

When Coronavirus first emerged in Wuhan, the researchers blamed it on the snakes and later, they have blamed it on the bats. While speculations that the virus is man-made exist, we need to recognize the dangers it is posing to the people and the economy. Due to an increase in the death rate, the UK's government has taken steps to limit exposure and has provided financial support to the companies.

Despite all the restriction and precautions in place, the situation keeps on getting worse, and many construction owners are concerned about the stability and financial situation of their business.

Contractors are facing delays, and the costs keep increasing, due to the ongoing COVID-19 situation. They are now facing many challenges, and they are seeking an extension of the time for the delivery of their projects. Because the rates they have used to secure the woks did not include the 2m current restrictions the time it takes to complete the works will now increase. They will no longer be able to achieve the efficiencies and the duration to complete the works that they originally allowed for, and now all their build costs and preliminaries will have to go up. Companies are currently facing difficulties in procuring supplies as well as the shortage of labour that this pandemic has created. Permanently employed labour now prefer to be on furloughed and avoid exposing themselves to COVID-19 in exchange for the 80% value of their salary.

The government must support these industries in the next few months so that they survive and recover after the crisis. Huge investments will also be required in most of the industries to re-achieve normality. After all, the demand for new houses and new buildings will be rising constantly, and the only way to meet those demands is to have a good functioning industry.

While the contractors have now started to re-open their sites while following the advice of the government we always need to remain mindful of the fact that if in a certain area, the number of infected people is continuously rising, we need to do everything we can to reduce the burden on medical or healthcare systems.

If we fail to recognize this, the system will collapse after a certain time, and many people that could have been saved will eventually die. For minimizing its growth, every person and company must play its role and follow the government advice to take precautions and to avoid spreading it.

The world is facing severe economic loss due to the Coronavirus and it will be extremely hard to recover from this. All companies that are facing major disruptions in providing their services need to bear in mind that the loss of profit will be recovered in time, all companies that fail now can be rebuilt later and they will emerge stronger if they have learned their lessons, but the loss of people and employees will leave a mark on their conscience that will never fade away. For smaller construction companies that want to survive in this environment having a good Estimator and a good Quantity Surveyor to look after their tenders and secure projects will be key to overcoming this period of crisis. All the rates will need to take into account all the restrictions and reduced outputs and using the traditional method of “historical winning rates” or reducing the profit margins will be the end of the company. We at The Estimating Group as well as most of the Freelance Estimators and Freelance Quantity Surveyors in UK will be happy to assist the smaller companies with their estimating or quantity surveying requirements.

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