The chancellor has announced plans to invest over half a billion pounds into training new construction workers, including through 10 new ‘technical excellence colleges’, more skills bootcamps and financial incentives for foundation apprenticeships.
Ahead of next week’s spring statement, Rachel Reeves said the government hopes to train “up to 60,000 more engineers, brickies, sparkies and chippies” to hit Labour’s target of building 1.5 million new homes by the next general election in 2029.
The government hopes a multi-pronged investment package, announced by the Treasury today, will create a “steady flow” of construction workers to help meet the housing target.
The package includes manifesto-promised initiatives such as technical excellence colleges, plus £2,000 cash incentives for employers to “retain” foundation apprentices, alongside funding for already established measures such as construction work placements, skills bootcamps, and local skills improvement plans (LSIPs).
Reeves said the 1.5 million homes, new roads, rail or energy infrastructure would not be possible without tackling the “massive shortage” of tradespeople who “actually get the work done”.
Latest Office for National Statistics figures show that there are over 35,000 job vacancies in the construction sector and employers report that over half of vacancies can’t be filled due to a lack of required skills – the highest rate of any sector.
Reeves added: “We’ve overhauled the planning system that is holding this country back, now we are gripping the lack of skilled construction workers, delivering on our Plan for Change to boost jobs and growth for working people.”
College leaders have said the package announced today will help them “reduce barriers” to training including by filling staff vacancies .
Here’s what the Treasury has announced so far:
Technical excellence colleges
There will £100 million of “new investment” for ten technical excellence colleges, which will involve giving existing further education colleges “additional funding to create specialist facilities, equipment, and curriculum for construction courses to directly meet industry needs”, the Treasury said.
Around £80 million will be for capital and the remaining £20 million will be for revenue spending, with funds made available from 2025-26.
Ahead of Labour’s election victory, prime minister Keir Starmer said further education colleges would be able to bid to become “specialist” technical excellence colleges if they prove to Skills England that they can meet skills needs, lever investment from employers and utilise other local institutions.
Re-bootcamp
Skills bootcamps in construction are set to be expanded with £100 million in extra funding.
This follows the DfE pausing its national commissioning of bootcamps, although it will continue to fund them through ringfenced grants to mayors and local authorities next financial year.
The Treasury is yet to confirm who will oversee commissioning the newly announced funding for construction bootcamps.
Bootcamps, short sector-focused courses aimed at moving adults into new or better jobs, were first funded to boost employment and skills during the pandemic.
Up to £584 million was set aside for them between 2022 and 2025, but data on their success suggests that only a third of learners go on to gain a job in the field they trained in.
£2k foundation apprenticeships incentives
The Treasury says new foundation apprenticeships, launching in August this year, will be backed by an “additional £40 million” – the same amount that was first announced in October’s budget.
Construction will be one of the “key sectors” for foundation apprenticeships, with a new incentive of £2,000 available for employers who “take on and retain” a foundation apprentice.
Funding for training foundation apprentices will come from the growth and skills levy, currently known as the apprenticeship levy.
The Treasury has not confirmed how many £2,000 grants are available, but if the full £40 million is spent on the incentives then it will be used up with 20,000 places.
Industry placements
More than 40,000 construction industry placements will be funded by a £100 million contribution from the Treasury and £32 million from the Construction Industry Training Board.
The placements, aimed at addressing a so-called “leaky pipeline” of learners who “don’t progress into the sector” because they are not “site ready”, will be available to all level 2 and 3 learners, students on NVQs, BTECs, T Levels and advanced apprenticeships.
The CITB, a government-sponsored body funded by a levy on construction firms, will also “double” the size of its new entrant support team, which focuses on helping small businesses recruit apprentices. The team’s current size is unclear.
More construction courses in colleges
Colleges will see £165 million made available to deliver “more construction courses”.
It is unclear how this funding will be distributed, what conditions will be attached or when it will become available.
LSIP stimulus
England’s 38 local skills improvement plans (LSIPs) will receive £20 million to “form partnerships between colleges and construction companies”.
A key aim will be increasing the number of teachers with construction experience to “train the next generation of workers”.
Broken down, the funding equates to about £526,000 per LSIP area, similar to the £550,000 each employer representative body was paid to develop the plans between 2023 and 2025.
Capital pot ‘for employers’
The above initiatives add up to £525 million.
When asked how the £600 million figure was calculated, a Treasury spokesperson said there is also an £80 million capital pot to support employers to deliver bespoke training based on their needs. Officials are yet to elaborate.
Cash injection will help colleges fill vacancies
Anna Dawe, principal of Wigan and Leigh College, said: “Our college boasts a strong and comprehensive offer across professional construction and construction trades, but currently there are real barriers to us and our employer partners being able to do more.
“Investment to reduce those barriers and enable us to offer additional pathways into such an important sector is very welcome.
“We see the high demand amongst young people wanting to enter the construction sector, adults looking to upskill and employers wishing to secure the right skills so a targeted strategy such as this has the potential to reduce the number of young people not in employment, education or training (NEETs), remove barriers to training and contribute to productivity in our locality.”
Jerry White, principal of City College Norwich, Paston College and Easton College added: “We have just opened a new construction skills hub and this will enable us to fill it with the staff required to teach the students and apprentices of the future.
“Any increase in funding will help us pay staff at the industry standard rate, meaning we can truly recruit the best people for these roles.
“The Department for Education’s workforce survey last year showed one in 10 teaching roles in construction in colleges was vacant – this funding will help us address that.”
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