As of late, the international construction industry has taken a tumble. Britain, in particular, has felt the brunt of it due to the devastation Brexit caused for the economy. Hiring a contractor can be seen as a luxury service. Particularly, if you are building an extension on your home. During a period of recession or economic uncertainty, many people will not risk taking on this type of financial burden. Construction industries have also halted development areas where houses were to be built. Currently, there is not the demand to buy them.
Britain is not the only place where this has been happening. All over the world, the construction industry has been faltering. There are many reasons why this is the case. It is not clear whether there is one main cause. What is clear is that in Tokyo and other areas of Japan, the situation is completely different. Here, the construction industry is thriving. Unique socio-economic factors provide part of the reason for this. However, there is also lessons to be learned for construction businesses in this area of the world.
It should be no secret that the population in Japan and Tokyo is growing at a phenomenal rate. In fact, Japan is beginning to rival the population growth levels of China. Although currently, the rate of population growth is nowhere that of the sister country as of yet it is climbing. As such, it makes sense that there is a demand for housing in this part of the world. Thus, the construction industry is in full swing. Japan isn’t the only country that is seeing a massive rise in population. Due to immigration and couples having more children, both England and America have also seen steady increases. Therefore, shear demand can not be the only reason for the success of construction businesses.
In England, housing development and construction planning are incredibly controlled. There are rules and regulations about where and under what circumstances a housing estate can be built. Or, when a business park can be established. For instance, in the north of England right now there is a derelict and decrepit theme park that has not been open for years. Several years ago there were plans to build a housing estate on this plot of land. Those plans were halted due to the land being part of the green belt. By-laws protect this area from being built on. In the south of England, there is currently new plans for a theme park to rival Disney World. However, developers are already feeling the push from local communities, pressure groups and councillors. It is understandable why the construction industry struggles in countries like the UK.
The same restrictions are not currently in effect in Tokyo city. Residents have no say over whether an area is used for housing developments. Construction companies can build wherever they want. Ethically, this freedom is questionable. It has certainly led to many Tokyo residents now living next to construction sites. However, there is no doubt it has provided a huge boost for the construction industry.
Cheap Set Up
Of course, legal issues aren’t the only reason why the construction industry struggles in the UK. Construction companies have a hard time setting up because the first fix cost is so great. The equipment needed is often expensive, and it is difficult to find investors who are willing to take gambles in a struggling industry. Although, there are ways around these fixed costs. For instance, companies can buy second-hand equipment such as excavators, diggers and drills at lower prices. Still, this does not change the fact that Japan is the area in the world for cutting-edge technology. Construction tech here may be considered far more advanced than the type of machinery you can get in the UK.
Saving The Construction Industry
The construction industry in Japan works differently to the industry in other countries. Is the construction industry under threat? This is unclear. It does seem as though high costs and legal issues make it difficult for new companies to get started. A closed off market is always going to make things more difficult. It will prevent an industry from reaching its full potential. It may be time for countries to follow in the footsteps of Japan. Give construction companies more freedom when choosing where to build. Saving the environment should be a top concern. It can not be ignored with rising populations; we need more buildings at cheaper costs.