The water market in England and Wales is now changing faster than at any point since the regional water authorities were privatised around 30 years ago.
Deregulation has now ended the monopoly of regional water provision for businesses creating the world’s largest competitive water market. It’s estimated the move will save British businesses £200m a year and provide new opportunities for firms to use water more efficiently by installing water saving devices, monitoring usage, and consolidating water supply across multiple sites.
At the same time the utilities are also investing more to improve Britain’s ageing water infrastructure. Severn Trent has embarked on the largest engineering challenge in its 32-year history by investing £300m to improve the 100-year-old Elan Valley aqueduct which brings fresh water from Wales to Birmingham. Anglian Water will invest a further £425m this year as part of its £5bn programme to maintain and improve water and sewerage services up to 2020 while Yorkshire Water is investing £3.8bn in services to 2020.
These investments and many more besides will help to maintain water supplies and reduce water leakage. While a great deal of progress has been made to reduce leakage by a third from their highpoint in 1994/95, the rate of improvement has slowed as the latest figures from the Consumer Council for Water show leakage only reduced by 1.4% to 3,087 megalitres a day in 2015/16.
While the tides of change are flowing through the water sector, the utilities will not be able to make a success of it unless they adapt their organisations to meet the challenge of change.
One of the key problems the water industry faces in meeting these challenges is an ageing workforce. The Energy and Utility Skills Group have previously noted that due to retiring workers and significant capital expenditure programmes, in particular in new technologies, the gas, power, waste management and water industries, need to recruit tens of thousands of additional staff. The skills gap Britain faces is only going to widen across all sectors when we leave the European Union.
To meet these challenges water providers needs to put a plan in place to reach their improvement targets and fill the gaps they have in their talent pool.
Key to this is creating a more flexible workforce.
While more than 40% of NES Global’s permanent recruitment business occurs in the infrastructure and construction sector we are already noticing more and more firms turning to contractors to help them manage periods of change and uncertainty.
Hiring contractors provides a number of advantages when compared to taking on permanent staff during such times. Using contractors means you’re much more likely to find ‘plug and play’ candidates that will add value to the business instantly – rather than taking the time to train up permanent staff.
Contractors also remove significant costs to businesses by removing the need to pay for staff National Insurance Contributions, pensions, holiday pay, as well as healthcare and other staff benefits.
Contractors also reduce the cost of recruitment fees compared to permanent hires.
Building a team of trusted contractors can help utilities to react quickly to tackle new projects and to launch new teams to embrace the new opportunities created by water market deregulation.
- Whether hiring contractors or permanent staff there are other things that can be done to increase workforce flexibility. The kind of terms and conditions that can be inserted in the contracts of permanent and temporary staff include:
- Mobility and movement: To allow staff to move to another location or to other reasonable day to day work if required.
- A project completion bonus: This can incentivise a workforce and for employers also reduce costs if any workers leave before the project has been completed.
- Annualised hours: if your business has major peaks and troughs throughout the year, you might look at averaging out hours across the year for some or all employees whereby staff would work reduced hours during quiet times, and increased hours during peaks but the employee would be paid in equal instalments throughout the year.
It is important for water utilities to remember that they must remain attractive in the battle for talent, however as they build their workforce for the future, flexibility should be at the heart of everything they do.
As the saying goes: “It’s not the strongest or the most intelligent who thrive but those who can best manage change.”
View our construction and infrastructure recruitment page to find out how NES Global Talent can help you.