Construction Assignment Sample

PESTLE ANALYSIS OF CONSTRUCTION INDUSTRY IN THE UK

Introduction

The construction industry in the United Kingdom (UK) is a diverse industry that helps in maintaining the different kinds which range from construction, manufacture and to supply, maintenance, operations, and disposal of the industrial sectors. The business environment moreover has to be maintained with the help of effective implementation of policies and management of the construction industry which may help the business to flourish well. In this essay, the working of the construction industry has to be stated which may help in understanding the factors which might influence the working of the business in an effective manner in the competitive business environment.

Discussion about the factors within the business environment which impacts the construction industry

The political factors help in understanding the influence of the government helps in maintaining the economic and industrial factors which help in reducing the trade tariffs, conflicts with other countries or places, and in maintaining the taxation of the country. However, the construction industry suffers a lot with inefficient and low productivity which may not be maintained by the potential shortcomings rather may be helped with the help of automated systems (Delgado et al., 2019). The construction industry also suffered heavily during the Covid-19 situation when the whole of the UK was under the lockdown situation which caused major problems for the industry management. The construction business emerges with good innovation, skill management, and effective regulations of the industry management sectors which may be possible with the help of the government’s support and better political management of the country which helps the business to flourish and even to sustain for a longer period.

The government of the UK makes sure that the construction industry flourishes in every possible way which helps the business to provide employment to various kinds of people. A Construction Leadership Council (CLC) has been set up in 2013 which helps in implementing the Construction 2025: Industrial Strategy for Construction which helps in maintaining the innovation, management, and effective working of the construction industry (Designingbuildings.co.uk. 2022).  The government of the UK has implemented several policies which may help the construction business such as Modernize or Die in 2016 for improving the skills of the farmers, Construction Sector Deal as part of the industrial strategy which may help in transforming the construction business with the help of innovative methods (Parliament. UK. 2022.). Thus, it may be stated that the construction business of the UK is flourishing with the help of the improvement in efficiency and better operation.

The economic factors of any kind of business depend on the political scenario the country has in which the business wants to thrive in a successful manner. Furthermore, the economic factors of the construction business may help in managing the long-term prospects in the market which may be managed with the help of demand and supply of the market. The construction business has increased by about 1.1% in 2022 as compared to 2019 with the help of growth in housing and repairing and with better maintenance and management of the industry (Ons.gov.uk. 2022). The business of the construction may flourish which may help in the progress of the economic condition of the UK although due to the Covid-19 situation the business may have dropped from £119,087 million to £99,651 million which may have affected the business widely (Ons.gov.uk. 2022).

The drop in the economic conditions of the construction business may have put a negative impact upon the growth of the business which may have been mitigated with the help of various measures which the government of the UK has taken up. The construction industry in the UK is a vital sector for the economic growth of the UK as it not only provides employment, however, it also provides key resources for sustenance in the global construction business. The construction industry with the help of effective technological and developmental factors may help the industries to progress with the help of effective opportunities and management (Alaloul et al., 2020). The UK construction business has been effectively developed with the help of management with the help of green and sustainable construction which may help in fulfilling the growing demands of the global market. Therefore, the productions, raw materials, and other valuable goods and services help the UK construction industry with the help of effective skilled labor management.

The construction does provide employment to many people who helps in the improvement of the social life of the people of the UK which helps the people to afford housing and a decent lifestyle. The population density of the UK is over 56 million which makes the country in a need to provide employment to the population for survival which helps the country to grow well (Worldometers.info. 2022). The attitude and the behavior’s of the people changes with the surroundings as it help the people in fulfilment of the demands of the population by the government. Therefore, the construction industry in the UK helps in narrowing the gap between the people with the help of cooperation and coordination which helps the people to have employment and also in maintaining a better lifestyle. The government of the UK also tries to make sure the way the construction in a civic area affects the attitude and livelihood of the people and the way it impacts the lives of the people in an effective manner.

The positive and negative impact of the construction upon the people helps the builders and the constructors to understand the behavior’s and attitude of the people which helps the contractors to improve the working of the industry in a well and effective way. The increase in the capital and income of the people helps the people to welcome the construction industry and even the construction industry tries to could the people in order to make effective profit management. Thus, the contractors use the local resource which increases the economy of the local area, and even it helps the construction industry to have better networks which even helps the small business to improve in the regional areas in a better way.

The macro-environment of the business in the UK includes another factor which is the technological environmental factor and it has an immense influence on the construction sector of the country. The construction sector is booming in the UK as technological advancement incorporates advancement in the business environment through which the industry may provide a perfect plan within a specific time. Modern technology such as data analytics helps the contractor or the project manager to make more informed decisions which reduces the overall construction cost based on cost and labour data. Big data analytics helps to gain the sector in the country in terms of strategic business value as well as competitive advantage and it enhances the capability of the sector (Grover et al., 2018). The advancement of technology also helps the contractor to access blueprint, contracts, and documents, agreements with the suppliers as well as quotations with the buyers and thus it eases several processes of the construction sector as a part of the business. The supervisors of the construction sector have utilized the modern technologies as they may communicate with the office as well as the labourers and provide timesheets according to the real-time performance of the employees.

However, the technological advancement in the UK also creates some issues such as privacy violations of the data for the construction sector and due to the issue the construction sector may not take competitive advantage in the market. Smart contract system of security of payment in a construction contract may ensure the process of payment throughout the project which reduces the burden of administrative cost and avoids intermediaries such as banks and lawyers (Ahmadisheykhsarmast and Sonmez, 2020). The overall opportunities of the technological business environment have been discussed in the construction sector in the UK and it provides an insight into the contemporary business situation of the country.

Legal factors play an important role in every sector of the business in the UK and there are particular laws and codes which are strictly followed by the companies to grow their business. The Society of Construction Law (SCL) has offered complaints which help members, employees or consultants in the construction sector to complain based on the treatment of other people which helps to maintain the code of conduct in the sector (Society of Construction Law. 2022). The SCL also ensures privacy of data from unauthorised access, disclosure and unauthorised modification or improper usage and provides technical measures to protect whole business procedure. The country also takes the responsibility of the data as SCL is the data collector of the consumer due to the digital process of the UK and it uses up-to-date procedures of privacy as well as security which boost the privacy level of the sector. The Delay and Disruption Protocol is another useful law of the country which helps the sector to avoid delay in the construction as well as maintain transparency in the process.

The consumer also gets help through the Delay and Disruption Protocol as the construction company has to pay for the unnecessary delay or disruption in a project which also forces the construction companies to provide compensation. On a specific note, implementation of SCL protocol helps a country to prohibit wrong industry practices and reduce disruptions due to any kind of disputes as working relationships worst affects the sustainability of the construction (Mayoorasakithian et al., 2020). The policies in the legal sector regarding construction balance the whole work process strictly and legal factors play a crucial role in the macro environment of the UK which ultimately provides sustainability to the sector.

Environmental factors are another part of the macro business environment of construction in the UK and it has a major impact on the sector especially in terms of pollution. The construction sector in the country has a detrimental impact on the climate as huge carbon emission is the consequences of the activities which are directly associated with the sector. Urbanisation is happening at a higher rate and the huge number of constructions amplifies the amount of carbon emission and adoption of low carbon technology, restricting energy utilisation may solve the issues (Ahmed et al., 2020). The several initiatives of the UK such as net zero carbon emissions, reduce plastic wastes to fulfil the Sustainable Development Goal (SDG) creates a kind of pressure on the construction industry of the UK to minimise the effect to maintain the sustainability. The UK has already taken initiative to reduce greenhouse gas emissions to net zero by 2050 and it forces the industry to take right measures to optimise the issues regarding climate crisis.

There are various codes which are taken by the country to control the emission of carbon as the new buildings will be highly energy efficient and forced to use bio energies in case of construction as well as replacing techniques of cooling systems, machines and many more. Carbon reduction policies ensure the regional impacts as well as it has also a critical role in interconnected, indirect, complex global supply chains of the construction industry in the macro-level carbon emission (Onat and Kucukvar, 2020). In this way the environment becomes a crucial factor for the construction sector as the high rise of pollution constantly creates issues in the climate which restricts some traditional ways of work process.

Conclusion

It may be concluded from the detailed analysis that the construction sector is one of the booming sectors in the UK and the special focus on analysis regarding macro business environment helps the reader to understand opportunities as well as threats in the country for business. Political assistance helps the sector to retain its position in the competitive market after the pandemic situation and it helps to maintain the position with the help of strong economic conditions as well. The legal factors also are favourable for the sector, however, it balances relations among the consumer, suppliers, contractors by providing proper verdict and the environmental initiatives forces the sector to implement some changes in work process to maintain sustainability for the planet.

References

Ahmadisheykhsarmast, S. and Sonmez, R., 2020. A smart contract system for security of payment of construction contracts. Automation in construction, 120, p.103401.

Ahmed Ali, K., Ahmad, M.I. and Yusup, Y., 2020. Issues, impacts, and mitigations of carbon dioxide emissions in the building sector. Sustainability, 12(18), p.7427.

Alaloul, W.S., Liew, M.S., Zawawi, N.A.W.A. and Kennedy, I.B., 2020. Industrial Revolution 4.0 in the construction industry: Challenges and opportunities for stakeholders. Ain shams engineering journal, 11(1), pp.225-230.

Delgado, J.M.D., Oyedele, L., Ajayi, A., Akanbi, L., Akinade, O., Bilal, M. and Owolabi, H., 2019. Robotics and automated systems in construction: Understanding industry-specific challenges for adoption. Journal of Building Engineering, 26, p.100868.

Designingbuildings.co.uk. 2022. UK construction industry. [online] Available at: <https://www.designingbuildings.co.uk/wiki/UK_construction_industry> [Accessed 12 March 2022].

Grover, V., Chiang, R.H., Liang, T.P. and Zhang, D., 2018. Creating strategic business value from big data analytics: A research framework. Journal of Management Information Systems, 35(2), pp.388-423.

Mayoorasakithian, T., Abeynayake MDTE, M.D.T.E. and Liyanage, K.L.A.K.T., 2020. Implementation of SCL protocol to ensure the construction sustainability during the execution stage.

Onat, N.C. and Kucukvar, M., 2020. Carbon footprint of construction industry: A global review and supply chain analysis. Renewable and Sustainable Energy Reviews, 124, p.109783.

Ons.gov.uk. 2022. Construction industry – Office for National Statistics. [online] Available at: <https://www.ons.gov.uk/businessindustryandtrade/constructionindustry> [Accessed 12 March 2022].

Parliament.uk. 2022. [online] Available at: <https://commonslibrary.parliament.uk/research-briefings/sn01432/> [Accessed 12 March 2022].

Society of Construction Law. 2022. Complaints. [online] Available at: <https://www.scl.org.uk/about/policies/complaints> [Accessed 12 March 2022].

Worldometers.info. 2022. United Kingdom Demographics 2020 (Population, Age, Sex, Trends) – Worldometer. [online] Available at: <https://www.worldometers.info/demographics/uk-demographics/#urb> [Accessed 12 March 2022].