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COVID-19 [May] update: its impact on construction projects

COVID-19 continues to impact construction projects in the UK and the wider economy. Read on for the latest industry insights.

COVID-19 cases continue to go down in the UK

The UK has reached the lowest number of COVID-19 daily cases since late summer last year. The 7-day moving average at the end of April has fallen below 2,000 daily cases. On the first Sunday of May, there were ‘only’ 1,671 new cases registered. Part of this partial win is due to the number of tests being undertaken. Although daily infections show a relatively low number compared to the infections of the last few months, there is still more work to be done.

As of the 1st of May, over 34.5 million people have received the first dose of the vaccine in the UK. Over 15 million people have also received the second dose. This represents a vaccination rate of 72 doses per 100 people. The UK is in the fourth place of vaccination rates in the world, just behind Israel, United Arab Emirates and Chile. Thanks to this, the UK is now shifting its focus towards second doses.

People aged 40-49 have started being offered a first dose of the vaccine in the UK. Professor Tim Spector, who runs the ZOE COVID app, says that it looks like the UK is past the pandemic period. This is because only 1 in 40,000 symptomatic cases are being recorded in the UK. Despite this good news, a cross-party group of MPs has recommended the government to discourage holidays abroad after 17th May to avoid a new wave of infections and further lockdowns.

Bidding and procurement changes due to COVID-19 impact on construction

As the UK slowly moves back to normality, COVID-19 continues to impact construction projects. In fact, a major issue that is affecting a large majority of construction sites is the shortage of materials. John Newcomb, CEO of the Builders Merchants Federation, recently published a statement warning construction firms to plan ahead. Although materials are available, lead times have lengthened as construction activity continues to pick up following COVID-19 impacts. The worst-affected product areas continue to be timber, roof tiles and roofing membranes.

COVID-19 is also impacting how construction companies bid for work. Contractors are becoming more cautious about over-stretching themselves by taking on too much risk responsibility at the bidding stage. They are now working more thoroughly to ensure that they assess risks appropriately. Contractors want to ensure that they can deliver the works within budget and with a profit. Pressures forced upon them by COVID-19 have shown how easily they can lose money if those risks are not measured and mitigated correctly. This new mindset in construction companies regarding risk can change the future of bidding.

London projects hit by the pandemic

The coronavirus pandemic has also negatively impacted work at Big Ben. Sir Robert McAlpine’s conservation work on the Elizabeth Tower in Westminster was due to finish later this year. However, COVID-19 has impacted the construction site and has delayed this work until next year. COVID-19 forced the project to increase in costs up to £9m. Teams are now working at full capacity on the site after a four-month closure last year. They are working hard to ensure that the four clock faces will be visible on New Year’s Eve 2021. The new finish date is before summer 2022.

52 senior transport planners and climate experts wrote a letter last month to transport secretary Grant Shapps and London Mayor Sadiq Khan, asking them to stop the Silvertown Tunnel. The 52 academics and campaigners argue that COVID-19 has impacted long-term transport projections. As a result, a project like the Silvertown Tunnel, which will have a massive environmental impact, should be reassessed before going ahead. Most industry experts agree that COVID-19 should represent an opportunity to prioritise the change towards a more sustainable construction industry.

The disruption in air travel has also pushed Network Rail to bring its Western Rail Link to Heathrow project to a pause. Network Rail has now confirmed that they are moving their staff to other projects. In February, Heathrow Airport Ltd announced a £2bn loss for the financial year. Passenger numbers went down 22 million compared to the previous year. Network Rail will not resume the project until Heathrow can commit to its part of the funding. Due to the current uncertainty, this is likely to take months or even years.

COVID-19 impact on construction may be closer to the end

To end on a positive note, a new report by GlobalData has suggested that global construction will grow by more than 5% this year. The report says that the sector is likely to rebound from the historic collapse in 2020 triggered by the closure of sites and restrictions imposed by COVID-19. GlobalData lead economist Danny Richards said:

‘In markets where the construction industry has managed to return to relatively normal level of operations since the crisis engulfed the world in Q2 2020, activity has rebounded positively, with signs that in some markets there has been a marked effort to get projects back on track quickly.’

The UK is amongst those countries that have managed to rebound activity positively. But we still need to work closely as an industry to ensure that the positive outcome is maintained over time. Investing in new, green technology is crucial to ensure a brighter future becomes a reality.

Has COVID-19 impacted your construction project? Let us know your struggles in the comments below!

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