Project Management Institute

Brexit's blowback

the U.K.'s historic vote to leave the European Union doesn't bode well for Britain's construction sector


An illustration of the proposed nuclear plant in Somerset, England

Britons’ historic Brexit vote shoved the U.K. into unfamiliar territory. While the ultimate effects of the vote are unclear—actual departure from the European Union (EU) might not happen for years—the news was bad from the start for the U.K.'s construction sector.

Exhibit A: A proposed £18 billion nuclear power plant project in Somerset, England might never happen. French sponsor EDF is “extremely unlikely” to continue with the project because of economic uncertainty, the Independent newspaper reported. Another potential casualty: an £18.6 billion project to construct a third runway at Heathrow Airport in London, England.

“The government must clarify what will happen to the EU construction workers in the U.K., as they are currently filling the gap left by our skills crisis.”

—Richard Beresford, National Federation of Builders, to Global Construction Review

The construction industry in the U.K. was originally forecast to grow 4 percent in 2017, but that estimate sank to 1.5 percent after the referendum decision, according to Timetric's Construction Intelligence Center. Foreign organizations backing projects in the U.K. are taking stock of new risks, and some U.K. organizations are seeing portfolios shrink. In July, two major British architecture firms announced they were laying off staff due to stalled projects and economic volatility. And project managers may soon have to deal with a labor shortage—12 percent of U.K. construction workers come from overseas, most from EU nations.

“The government must clarify what will happen to the EU construction workers in the U.K., as they are currently filling the gap left by our skills crisis,” Richard Beresford, chief executive of the National Federation of Builders, told Global Construction Review. —Kelsey O‘Connor

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