This month at the Facilities Show FMJ will be hosting our annual debate. In it we will be asking whether the facilities management industry is prepared for the fall out from the impending skills shortage? Where are the industry’s strengths and weaknesses in relation to this?
If there is indeed a skills shortage – and I’m not 100 per cent convinced that’s going to be the case – then the fault for that will lie squarely with employers, and thus the remedy too lies with them.
Across a range of industries – FM is by no means unique in this – employers have failed to adequately train staff in a range of trades over the years. Having argued for, and been granted by government, the abolition of Training Boards and the associated levies, it should hardly be surprising that a predominantly cost led contracting industry has been unable to provide for skills based training. Unpopular as it might be to some of the more self-interested employers, re-creating a level playing field by re-instituting the Industry Training Boards would be one obvious solution. Such a move would support smaller businesses, provide a career path for staff (the subject of last month’s column), move us towards a more sustainable employment base, reduce the use of migrant labour, and its costs would be largely recovered through modest fee increases to clients without negatively impacting competitiveness. So of course it’s not going happen – because some employers feel that inhibits their competitiveness. Which may be why UK per capita GDP is behind that of Germany, Italy, France among our main competitors.
So what can we do? Well the traditional solution over fifty years or more has been to import skilled labour, which is obviously still an option (unless UKIP has formed the next Government – this was written before the May election). That’s clearly still an option, and as a short term fix it may well work. But we do need to address the longer term systemic problem of skills shortages, and if employers as a whole won’t accept compulsion, what other alternatives exist?
There are two significant possible impacts of absent skills in our workforce. Firstly we might expect the costs of skilled labour to rise as employers have to chase fewer available staff, and thus have to pay them more. That cost will normally be passed on, eventually, to buyers of FM services, although in the meantime it might cause some smaller business to have cash flow problems and to fail financially, since their ability to renegotiate fees may be weaker than the larger employers, as well as them not having the cash reserves to cope with a short term financial loss, which creates a problem for buyers of services.
Secondly, the risk of staff shortages creates additional business risk – again, for the buyer of facilities service. Whether its for emergency call-out or compliance with statutory requirements, a shortage of skilled staff is likely to result in unacceptable business risk being created, for example in interrupted mission critical services, or in facilities having to be taken off-line. I suspect some buyers of services will be prepared to pay a premium to see staff trained, and in some cases may exclude providers from bidding if they don’t have better-than-adequate training and staff retention programmes in place.
You can see therefore that although the immediate impact of a skills shortage appears to be on service providers, in fact all parts of our industry have a vested interest in resolving the problem. Whether there is a forum for them to get together and agree a way forward remains to be seen – Building Futures would be one such possibility, and RICS another. What such a way forward would actually be if not compulsory I do not know – because it seems only by compulsion can we ensure that all supplier businesses bear a fair proportion of the cost of solving this problem, which was avoidable but is now, it seems, imminent.