The facilities management (FM) market in the United Kingdom is going through a transformation driven by technology innovation, new business models, emerging value propositions, and creative new service offerings. The market was valued at USD 67.29 billion in 2019, and it is expected to reach USD 70.14 billion by 2025, registering a CAGR of 1.86%, during 2020-2025.
The UK FM market is one of the most developed and mature in the world with a highly competitive international supply base; and it’s believed that the growing trend towards integrated facilities management drives the market. Integrated facilities management (IFM) is exactly as it sounds - bringing all your facilities management contracts under a single service – with benefits that include expert support with services, less admin compared with coordinating multiple service providers and lower overall cost of contracts/ability to stay within budget.
What is more interesting to note, is the sectors in which growth is most prominent. According to RICS, healthcare is the strongest performer and demand growth for serviced business space has now accelerated which is a significant turnaround relative to the negative trend reported at the same point in 2021. Retail is the sector that is experiencing the most setback.
What challenges does the FM market face?
Potentially the largest restraint in the growth of the UK’s facilities management industry is the widely recognised ‘skills shortage’ and the ability to source high quality talent. There are many reports across the industry that point to a concerning statistic that the average age in the sector is 50+; and the rate of people joining the industry is nowhere near enough to allow for the drop off rate that there will be within the next decade.
While there is no quick solution to the skills shortage problem the FM market faces, there are ways that the industry can begin to improve upon it’s reputation as a good, solid career choice. Partnering with schools and universities can increase the awareness that the younger generation has of the industry; and with an increasing focus on technology, AI and data, facilities management is a great choice for young, innovative minds.
A huge topic of discussion within the drive to recruit more FM’s and STEM professionals in general is the balance of male to female workers. Overall, women account for 50% of all apprentices in the UK. However, for STEM apprenticeships, they make up just 8%. It’s not unrealistic to believe that this is down to a lack of understanding for the industry, perhaps as well as a lack of provided information and opportunity to further explore the industry.
The avoidance of actively seeking more women to join the industry is possibly the biggest threat to the FM market and one of the largest obstacles to finding a solution to the skills shortage.
Other challaneges for the FM market found by The IWFM’s Market Outlook Survey 2022 included supply chain squeezes and creeping inflation. According to the survey, over 80% of FMs surveyed expected the rising energy prices to exert a negative impact over the year. As building owners seek to rein in costs, there is a natural tendency to pass on any inflationary pressure to the FM provider, cutting into the profitability of the industry.
As for supply chain issues, there are many factors that contribute to these problems for the FM market and the construction market as a whole, including labor shortages, Brexit trade barriers, global supply problems and panic buying.
Driving growth in the FM market
It’s not all doom and gloom. There are many positives in the FM market at present; the predicted growth for the sector being just one of them.
According to RICS UK Facilities Management Survey for Q1 2022, the top two areas of FM that respondents expect to see the strongest growth, and therefore drive overall industry growth, over the next twelve months are sustainability management and workplace and relocation management.
Sustainability in it’s own right has exploded over the last few years and, now, with net-zero targets worldwide, the sector is a huge focus for construction professionals; with facilities managers playing a vital role. Decisions that facilities managers make can have a tremendous impact, as long as they choose to embrace sustainability.
The requirement for making existing buildings greener is becoming critical. The energy savings, productivity increases, reduction in waste stream, and water conservation and other sustainable facility benefits in existing buildings far outweigh the potential benefits from sustainable new construction.
In addition, sustainability is emerging as a core business strategy and obligation for most organisations and the facilities management (FM) profession is at the forefront of delivering sustainable practices at the operational, tactical and strategic management levels.
Since the pandemic, changes to how businesses operate and where their employees operate from has vastly changed to how things were in 2019. These changes bring a huge area of focus to the facilities management industry and facilities managers play a key role in the decisions on how and where these businesses continue to operate.
Technology is also a key driver for the growth of the market. Integrating digital solutions into their delivery model is critical to differentiate, compete effectively, provide reliable and efficient service, and the key to ensuring market success. The ability to employ Big Data Analytics, AI and Machine Learning can add a further layer of empowered functionality by enabling truly intelligent insights and predictive intervention.
The UK Facility Management is a highly competitive market with the presence of several players of different sizes. Key Players to keep an eye on for trends in the market include CBRE Group & Mitie Group PLC.
Our specialist recruitment team operates across the UK and are ready to connect you with a wide range of FM professionals at all skill and experience levels. For a confidential chat about your talent needs, contact PRS on 0207 553 5660 or email firstname.lastname@example.org.