INTRODUCTION

In accepting the daunting challenge of leading this review, I was very clear in my mind that this had to be an exercise that led to change. This was never going to be just another report about the 'construction skills crisis' in isolation, it had to look much deeper at the fundamentals of how we deliver and why. There are numerous studies that analyse the well-rehearsed woes of the construction industry. Many also look to exemplars of activity to illustrate how things might be done at scale in a Utopian world. These approaches are both important but only in the context of how we then use that knowledge to effect modernisation and improve our industry at a strategic level. The hardest challenge for this review was always going to be how to avoid a straight rehearsal of what we already know, and really focus on what the fundamental change agents are and how this can be connected into an industry-wide transformation programme. This review is therefore deliberately as much about the 'how' as the 'what' and 'why'.

I was given clear terms of reference (page 71) and guidance from both Department for Business, Energy & Industrial Strategy (BEIS) and the Department for Communities and Local Government (CLG), which included not expecting a big pot of taxpayer money to throw at the problem. In addition, the overarching guidance from the Construction Leadership Council has been clear - do not pull any punches, look to challenge accepted norms and indeed be controversial if it will provoke debate and lead to the desired outcomes.

This review has looked to cover the ground in terms of taking soundings and evidence across many areas of the construction industry, with a particular focus on house building. It has become clear during the course of this work that the most important and effective drivers for change do not necessarily sit within the industry itself so a more holistic view has had to be taken that heavily influences the nature of the recommendations contained herein.

During the period of concluding this review, there have been tumultuous events in British politics centered on the decision to leave the EU. This has made the relevance of this review even greater with the need to find a 'home grown' solution to our problems now crucial, assuming less future reliance on migrant labour.

A by-product of the June 2016 referendum was a fresh government commitment to 'industrial strategy'. This is welcomed as the principles contained herein can essentially be viewed as some of the building blocks of a strategy to create a modernised and sustainable construction industry.

Many may see elements of my conclusions as being harsh or negative and indeed some of the recommendations as being controversial or overly ambitious. Some may also feel that the recommendations divert attention from the primary responsibility of the construction industry to resolve its own failings. This is not the intent and careful reading of this review will hopefully demonstrate a balanced and integrated analysis of the evidence that has then been developed into a series of logic linked recommendations.

I am hopeful that the issues identified and the principles established should enable all parties to step back and understand the seriousness of the predicament facing the construction industry. This also has direct ramifications for clients as end users of the industry and government as the custodian of the UK's economic and social welfare. I am very clear that if we do not address in short order how the construction industry operates and delivers, we will see a long-term and inexorable decline in its fortunes. This is not just another ''must do better' school report where the industry and its clients shrug their shoulders and carry on as normal. This review warns of potential marginalisation and deterioration that might not be recoverable. I do not believe construction's perilous future state was so clearly evident at the time of Latham's Constructing the Team in 1994 or Egan's Rethinking Construction in 1998. If this review does only one thing, it must be to bring the likely reality into greater focus.

The acceleration of the wider digital revolution combined with a shrinking traditional construction workforce are two issues I would highlight as being critical to the future fortunes of the construction industry. One could argue that the 'stars are aligning' and now is the time to allow the opportunities from digitisation to offset the risks of continued reliance on labour intensive techniques.

It is important to clarify that I do not want to create a divisive binary future industry where innovators or early adopters at the vanguard of change leave the laggards in isolation. This is about creating a vibrant, re-skilled, fully integrated, more predictable and productive industry such that traditional working and new approaches can co-exist and complement each other, driving much wider longer-term benefits..

All interested parties should consider and reflect on the impacts set out in this review of potential industry decline, not only from their own perspective but also hopefully prompting the desire for us to collectively create an appropriate legacy for future generations. I truly believe that being part of the engine room delivering our nation's built environment and by implication, economic prosperity, offers a massively dynamic and fulfilling career. However, continuing as we are is not an option if we are going to be able to make that claim in the years ahead.

Mark Farmer, October 2016