Firms brace for wave of redundancies
The impact of the sudden economic shutdown of the past five months is being felt across the region’s property community, as companies begin a wave of redundancy consultations.
Avison Young, Turley, CBRE and Arup are typical of a trend of firms across the industry expected to shed staff both nationally and in the North West, after placing some employees on notification of possible redundancy at the end of last month.
What started with firms pulling out of the Cannes property expo MIPIM at the end of February was quickly followed by the UK lockdown. Firms have been grappling with the impact of the Covid-19 pandemic ever since, and now face the prospect of further months of economic uncertainty ahead.
A spokesperson for Turley said: “We are responding to the challenging economic conditions by restructuring some areas of our business. We have worked hard to mitigate the immediate impacts through a series of short-term cost reduction initiatives across the business.
“Regrettably, this has included consulting on a limited programme of redundancy, which is a necessary measure to rebalance our costs and income as we work towards recovery.”
The spokesperson continued: “Sadly, three of our fee-earning team of 46 in Manchester are leaving us. We have also restructured our support teams to adapt to new and agile ways of working and, regrettably, four colleagues from our Manchester-based team of 33 are departing. We thank them for their contributions.
“Having adapted to home working, we have continued to work proactively with our clients across the UK throughout lockdown and continue to deliver our full range of services.”
Period of flux
CBRE said in a statement that it has “commenced a collective redundancy consultation with employees in its UK advisory business as part of a strategic review to optimise the structure of the business and respond to the impact of Covid-19 on market activity.”
It is understood that nobody has left the firm’s regional headquarters at One St Peter’s Square in Manchester through redundancy at present.
“CBRE will take every opportunity to mitigate the impact of proposed redundancies and will provide the necessary support to those affected during this period of change,” the statement continued.
“[The company] continues to invest in the business when opportunities arise and remains well positioned to advise clients during these challenging times.”
Avison Young has put its London-based staff on redundancy consultation and is also reviewing headcount in the regions.
Jason Sibthorpe, UK principal and president of Avison Young, said: “Navigating the business impacts of Covid-19 has been a challenge for us, as it has for our clients, our communities and the wider UK economy.
“Unfortunately, last [month], we notified UK teammates that some roles are at risk of redundancy in our regional business, and our London business has entered collective consultation.
“While we are beginning to see some green shoots in certain regions and sectors, we have taken these measures to bring Avison Young through this period set up for the future, so we can continue serving our clients to the highest standard.”
Sibthorpe added: “Our company is centered around people and these are not easy or quick decisions to make. We are incredibly proud of all our people – for their continued commitment to serving clients and the resilience they have shown during this unprecedented time.
“We will be supporting impacted employees by extending access to our employee assistance program resources and providing coaching and mentoring support.”
A spokesman for multidisciplinary firm Arup aims to cut 350 jobs from its national business. “Like many of our clients and partners, Covid-19 has crystallised the need for a reshaping of our business to reflect anticipated forward workload, business size, shape and skillsets to meet the post-pandemic market,” a company spokesperson said.
“As a result, Arup has taken the difficult decision to reshape the business, starting a consultation process that will affect up to 350 staff members in the UK. This decision has not been taken lightly.
“However, by taking action now, the firm will be far better prepared to navigate the challenges ahead, while maintaining Arup’s high standards in delivering quality projects.”
Meanwhile, in the construction sector, several firms have announced job losses in recent weeks. Engineering and construction firm Sir Robert McAlpine said in July it would cut 6% of its staff nationwide, while Wates Group axed 300 jobs in May, equating to 8% of its workforce.
Housebuilder Bellway is also planning to axe 6% of its workforce, although fellow residential developer Taylor Wimpey said in a trading update last week that it intended not to make redundancies despite reporting a £40m loss for the six months ended 30 June. Chief executive Peter Redfern said in a statement last month that making redundancies now would be “very short-sighted”.
Construction faces more systemic problems of wafer-thin margins and the need to chase work even at a loss, which has caused several contractors to collapse in the North West in the past few years.
Before the pandemic, Zoe Brooke, director of Widnes-based Whitfield & Brown, was part of a group of companies that launched the ‘Save Construction Initiative’ intended to support construction companies and members of the industry facing redundancy or business difficulties. The initiative is also lobbying for a better procurement system.