Labour accused of sabotaging its own plan to build 1.5m new homes | Politics | News
Construction firms have warned that Labourโs employment reforms will hike hiring costs and put the governmentโs target of 1.5 million new homes at risk. A survey of the Construction Plant-hire Associationโs (CPA) members found nearly half (46%) are โvery concernedโ changes in the Employment Rights Act will increase the burden and complexity of hiring, while a further 38% are โsomewhat concernedโ.
Industry leaders say measures being introduced under the legislation, including changes around guaranteed hours and wider employment protections, risk piling further pressure onto firms already battling rising energy costs, National Insurance increases and inheritance tax changes. Steven Mulholland, chief executive of the CPA, said: โConstruction businesses want to hire and train more people, but our concern is the Employment Rights Act risks making recruitment more expensive and more complicated at exactly the wrong time.”
He said that for small and medium-sized businesses already facing rising energy bills, National Insurance increases and wage pressures, “measures around guaranteed hours and wider employment obligations could make firms more cautious about taking people on.
“When employment costs rise, apprenticeships, entry-level opportunities and flexible roles are often the first things squeezed.
โGovernment wants 1.5 million new homes and major infrastructure delivery, but those ambitions rely on businesses having the confidence and flexibility to recruit and grow their workforce. If Labour is serious about delivering, it cannot make hiring more difficult while expecting firms to scale up at the pace the country needs.โ
Some 54 members, with a combined yearly turnover of ยฃ2 billion, completed the survey at the end of April.
The warning comes at a critical moment for the sector with just over 300,000 homes being added to the UKโs housing stock during the first 18 months of the Labour government.
This is significantly fewer than the numbers needed to hit Labourโs housing target.
The CPA has warned ministers that the Act must not discourage firms from hiring and investing in new workers, particularly at a time when the sector is already facing severe labour shortages and an ageing workforce.
The Government has been contacted for comment.
