What impact will Brexit have on the Builders cleaning industry in the UK?
Brexit has been a hot topic in the UK and across Europe since 2016; as Great Britain voted to leave the European Union changing its relationship to the bloc on trade, security and migration. Europe is Britain’s most important export market and its biggest source of foreign investment, and membership in the bloc has helped London especially, cement its position as a global financial centre. Brexit has been a major threat to all kinds of businesses and companies as the government projects a decline in economic growth of four to nine percent in the next 15 years. This leads one to wonder what potential impact this might have on the construction industry and specifically, on the Builders cleaning industry for Builders cleaning companies in London and the South such as BRS.
There are more than 32,000 cleaning companies in the UK with around 900’000 people working in the cleaning industry. The UK market for contract and builders cleaning is estimated to be around £24 billion. Migrant workers make up to 37% of the English cleaning workforce. Most cleaning companies are small businesses with 86% having 10 or fewer employees and only 1% of the cleaning companies having 200 plus employees. Although the large companies uptake an insignificant percentage of the cleaning industry; they provide work for approximately half of all cleaning employees.
Brexit has affected many factors in the cleaning industry with the most substantial being free movement. As mentioned above, a weighty portion of workers in the commercial and builders cleaning industry are migrants. The cessation of freedom of movement will greatly reduce the number of workers coming to the UK. There are advantages and disadvantages to this as Brexiteers may argue that this will open up new positions for the British workers which may lead to lower unemployment rates, however the Remainers will argue that not enough of the British public can fill these roles leading to lack of labour and a detrimental impact on the economy which is currently bolstered significantly by migrant workers.
With greater regulation when hiring EU workers looking likely, the builders cleaning industry could find itself going through some enormous changes in the years ahead. Opinions are very much split as to whether this will bring opportunities or challenges. This is to be expected considering the divisive issue of Brexit and the vibrancy and diversity of the professional builders cleaning industry.
Another factor likely to impact the changes in the cleaning industry is the devaluation of the pound. This is a sign of weakness and decline as the price of the British Pound plummeted to a 31-year low. Economists predict the pound will drop further which will affect the cleaning industry in the same way as most industries. The devaluation of the pound and the GDP causes inflation to rise meaning imports will become more expensive and exports cheaper as the Trade rules of the World Trade Organisation change. External tariffs would be set on international imports, thus making it more difficult and expensive for builders cleaning companies to source the necessary cleaning equipment required to operate. The extra weight of added costs may reflect back in price hikes, making the builders cleaning industry more expensive leading to less demand for cleaning services from potential customers. Overall, there may be a lower labour demand as people start to tighten their budgets.
Regardless, with the looming deadline of 31st October creeping up on us, at BRS we remain optimistic that the builders cleaning industry will remain popular as a service which will continue to be in demand as the UK continues to develop and renovate in the following years. The key is to be flexible and to embrace the change.