Diversity & Inclusivity – an SME Viewpoint

An often-quoted statistic is that 80% of construction business are in this SME ‘demographic’. In fact, something like 90% of construction firms employ fewer than 50 people. Specialist contractors almost by definition are even further represented in the SME sector, in the 50 or fewer employee's bracket.

This vital and essential group of firms seldom has the opportunity to have a voice when policy is being discussed.  The Tier 1 firms are well and strongly represented, understandably and rightly so, as they also are vital, but the SME presence is rarely felt at ‘top table’, yet this part of the industry is expected to, and should, realise the vison of well-intentioned policy making.

Challenges

Currently the challenges faced by the sector include post Brexit supply, labour and artisan staff and operational management issues; uncertainty and volatility caused by the conflict in Ukraine; environmentally responsible policy and regulation and, of course, Diversity & Inclusivity (D&I). For larger firms, with substantial head office and administration functions and resources, D&I responsibility is becoming integral to recruitment and development where it can be measured monitored and accommodated for SMEs there is a strong desire to develop an inclusive business but often a lack of dedicated resources.

The current shortage of ‘talent’, especially in some key skill areas, has been exacerbated by the perception, and perhaps the reality, that conventions and traditional thinking don’t make construction an attractive sector for young people making career choices.

A clear and obvious challenge for SMEs, is perhaps twofold. Firstly, simply attracting talent in what is a highly competitive market is already difficult when faced with the general shortage and the high demand and attractions of larger firms. Secondly, while larger firms ‘hoover up’ the talent in large numbers, they benefit from being able to make progress on representation at a faster pace. For an SME, each recruit is hard fought for and won, whilst many strive to focus on increasing representation the pace of change is often slower due to fewer opportunities to hire.

In conversation recently with a woman who had reached the pinnacle of leadership in a construction business, she expressed the thought that ‘irrespective of other criteria, the choice must be based on the best candidate for the role. This is a laudable sentiment, especially for a woman who has overcome the multiple glass ceilings in the sector. Talent from underrepresented groups want to be in their role for the skills and experience they bring and be recognised for that – rather than being seen as the diversity hire.

Statistics:

• Just 5.4% of construction workers were from a BAME background compared to about 13.8% of the UK population being from a minority ethnic background with London having 40% within this bracket.
• Women now account for just under half of the total UK workforce but only 11 per cent of the construction workforce and just 1 per cent of workers on site.
• The UK-born construction workforce age profile peaks at between 50 & 64 years old which means that construction will lose a quarter of its workforce - over 500,000 UK-born workers - in the next 10-15 years.

Adair has a very active and conscious philosophy to be non-discriminatory and fortunately, we have managed to build a diverse and inclusive workforce across a modest retinue of 30-35 staff.  Adair has achieved a reasonably balanced workforce population, in terms of D&I, by starting with the first principle of attracting the most appropriate talent and by ensuring there are no impediments to any candidates success. This is culturally embedded, and is championed by Bernadette Tyrrell, our Chair, who guides the way the business thinks from an outside perspective – Bernadette has a background that is not construction industry focussed, so sense checks that we are not closed thinking.

This is manifested by our open attitude to recruitment – we have interviewed 43 candidates over the past 2 years, made job offers to 30 of these and ‘only’ 3 of those candidates would be classified as the industry typical ‘White, Middle-Aged, Male’. Adair obviously has policies in place to support compliance, but our actions clearly show we have developed an inclusive culture where all talent can thrive – we just seek the best talent that comes into our orbit and we appoint without any ‘unconscious bias’.

Yes, we could do better and we shall but as each member of staff represents 4% of the complement, one candidate chosen either way affects the profile by up to 8%; some groups are almost impossible to represent fairly.

The road ahead

The construction sector has long recognised that becoming an equal opportunity employer is not just an obligation but is also common sense. At the CIC, in our drive to be a voice for SMEs, and in Adair, an SME, we recognise that accessing what has traditionally been, regarding gender equality for example, the ‘other 51%’ of talent is clearly excellent thinking, morally and in terms of competitive advantage for individual firms, as well as representative organisations such as CIC. This is, in fairness, improving but we need to appeal to all minority groups, so that the industry, and especially smaller business, can attract the best from the widest talent pool.

The legacy of the inability for the industry to appeal to the full range of potential talent, from operatives to senior leadership will require considerable business action with the  support of policy makers..

We must collectively be conscious that for an SME, it is more of a challenge just because the numbers are harder to crack. The industry is making huge progress however and for those of us in leadership roles and who have enjoyed the journey of seeing an industry evolve, albeit slowly, it is so encouraging.  Like most organisations, CIC has a D&I committee, dedicated ‘to identify and promote diversity policy and activities within the built environment’. Chaired by Maria Coulter, BEM MRICS, and an industry leader who has lived the experience of achieving seniority, as a ‘minority’, in the construction sector, the CIC D&I committee exemplifies the seriousness with which the subject is being taken

So, why are the challenges and opportunities of D&I important for SMEs and how to realise and resolve them? According to McKinsey’s report, “Delivering through diversity”, companies in the top quartile for ethnic diversity in their executive teams are 33% more likely to outperform their industry (EBITDA). As BPIC, (a voice for BAME), puts it in the publication ‘Review of the Business Case for Diversity’, the importance of remaining agile and innovative in an increasingly dynamic business environment makes the potential plusses of increasing diversity all the more powerful.

The shift needs to be from a ‘tick box’ compliance view to a cultural change that puts D&I front and centre of culture and thinking within the business because it just makes good business sense.

Now, in the face of the exceptionally demanding landscape, we must be emphatic and continuously mindful to attract, retain, enable, motivate the best and to continually test ourselves to ensure our criteria are optimal and informed by D&I drivers, no matter how tough to achieve. The built environment is for everyone and the more inclusive and diverse the industry can become the more it will serve the needs of our communities.