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February 7, 2022
The construction industry is one of the largest sectors in the global economy. For 2022, the global construction industry has a favorable outlook due to the growing population and the expansion of urbanization over the past decades, particularly as both developed and developing countries continue to invest in infrastructure.
In the UAE, AED751.5 million ($204.6 million) was allocated for infrastructure projects, among others, from the general budget for 2022. In 2021, the UAE government even invested in the construction of residential units as part of the Sheikh Zayed Housing Program, and is further planning to invest in a housing program in Dubai for the next 20 years. Overall, the construction industry in the UAE is expected to grow by 4.4%, registering an average growth of 3.9% annually from 2022 to 2025.
Given the increasing competitiveness of the UAE construction market, it is critical for construction companies to provide services in a more efficient manner in order to meet the industry’s rising demands. However, as with any other industry, some challenges are expected to persist, the most common of which are labor, skill, and productivity shortages.
Shortage on Labor, Skills, and Productivity
As the UAE experiences one of the largest expansions of the construction industry in the world, millions of migrant construction workers are flocking to find work there.
Nonetheless, the industry is facing global challenges in terms of labor, skills and productivity. The reasons for this, according to the McKinsey Global Institute’s (MGI) Construction Productivity Survey, are “poor project management and execution, insufficient skills, inadequate design processes, and underinvestment in skills development, R&D, and innovation.” To address this, MGI suggests that the construction industry’s key players “rethink their operating approaches.”
How to Rethink Operational Approaches?
As the saying goes, “modern problems require modern solutions.” In the UAE, manpower supply companies that offer flexible contracts are beginning to emerge, providing staffing solutions to construction companies across the country. To address labor and skill shortages, construction companies must be open to the idea of collaborating with these firms.
However, in choosing the right manpower supply company, we must consider three things:
First and foremost, the right manpower company must be flexible, allowing us to have a manpower supply whenever we need it to complete our project. Whether it’s for a day or a year, the right company will provide us with skilled workers to complete the job. It must also be cost effective, allowing us to negotiate hourly and monthly rates for we can be certain that we are getting our money’s worth this way. Finally, it must have a large pool of skilled workers so that we can choose the type of manpower we want while remaining confident that they are all capable of doing the job correctly.
The presence of these three elements in a manpower supply company will enable construction companies to not only complete their projects on time, but also to ensure that the job is done correctly. This way, the UAE construction sector’s skills and productivity issues will be addressed.
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