Engineering construction contractors working in the UK’s chemical sector have been among the hardest hit by the pandemic with headcount almost halving between 2019 and 2022, according to a new report published by the ECITB.

The ECITB’s Workforce Census provides a detailed snapshot of the engineering construction supply chain workforce and reveals the key challenges facing the industry. Analysis of survey data provided by ECITB-registered companies, shows the chemicals sector is the third largest in which engineering construction industry (ECI) firms operate, with 7% of the workforce working on chemical industry projects.

But companies operating in the chemicals industry have faced the greatest decrease in headcount, which has fallen by 47% between 2019 and 2021. A range of factors could be behind this including redundancy, retirement, contract expiration or moving to other jobs within or outside the chemicals sector.

Unlike other areas of industry where recovery is underway, employers in the chemicals sector don’t expect their staffing levels to recover pre-pandemic levels by 2023 and instead forecast a 4.66% decrease compared to 2019.  Delays and downturns in work due to the wider effects of coronavirus appear to have impacted more than half of employers (55%) operating in the chemical sector compared to less than a third (30%) for the wider ECI.

Across the engineering construction industry the ageing workforce presents a major challenge that will need to be tackled to avoid future workforce shortages. ECI firms operating in the chemical sector have the highest proportion of employees above 60 and nearing retirement (17%).

More positively, ECITB research also suggests employers have fewer hard to fill vacancies than the wider industry although this may correspond with lower levels of recruitment. At the same time, there are a higher proportion of younger workers in the sector: nearly 10% of the chemicals workforce is under 25, compared to 5% for the wider ECI, which should help to mitigate the effects of those leaving the industry.

Chris Claydon, Chief Executive of the ECITB, said: “Our census data presents a mixed picture for companies operating in the chemicals industry, who appear to be recovering slower than other parts of the engineering construction industry in the aftermath of the pandemic.

“As clients and contractors accelerate their decarbonisation journey and harness new net zero opportunities, they will need sufficient number of skills workers. Yet our census finds that the engineering construction workforce is growing slowly and has yet to return to pre-Covid levels.

“Coupled with the ageing workforce and the difficulty in hiring new workers, this is an area that requires immediate attention because it points to a real risk of skills shortages and gaps that could have knock-on effects for project delivery.

“This contemporary industry data is invaluable to the ECITB in understanding the skills needs of industry and how we can best represent the engineering construction industry accurately in our discussions with Government.”

Chris Claydon - ECITB Chief Executive

Tracey Shelley, Chief Executive of the British Chemical Engineering Contractors Association (BCECA), said: “BCECA welcomes this latest labour market intelligence from the ECITB. It offers valuable insight into the state of the engineering labour force, notably the loss of older workers to retirement. The findings will prove useful to our member companies as they  rise to the energy transition challenge and help us to advance the engineering contracting sector in the UK.”

Conducted in Spring 2021, the Workforce Census asked engineering construction industry (ECI) employers to provide information about their workforce numbers, locations and roles. Data collected included demographic information and asked for views on workforce growth, Net Zero, Covid-19 and Brexit. Fifty percent of the ECITB’s in-scope employers responded to the Workforce Census, representing 45,351 workers from 153 in-scope companies across 1,360 locations.

The report produced by the ECITB highlights an urgent need to address potential skills and labour shortages as employer responses show an ageing workforce and slow recruitment of new talent in some sectors. This is concerning given the workforce expansion required to deliver net zero by 2050.