Industry faces job cuts and closures

By BD news desk

Practices caught unawares by sudden impact of banking crisis

Britain’s architecture profession could be facing the prospect of mass redundancies and even three or four-day weeks in the wake of the worldwide banking crisis.

A consultant who works with some of London’s leading architects, but who did not wish to be named, told BD that 15 practices in the last fortnight had told him they were anticipating making between a third to a half of their staff redundant or alternatively reducing the working week by up to two days.

Atkins design director Martin Pease also predicted that one in five practices would go bust in the coming months.

The revelation emerged as it was announced that unemployment levels in the UK rose by 164,000 between June and August — the biggest rise for 17 years — and US authorities followed Gordon Brown’s lead by pumping hundreds of billions of dollars into into US banks in an effort to restore confidence.

“It’s tragic that so many firms who have been around for five, six or seven years and have put in a lot of hard work into building up successful practices are going to vaporise,” the consultant said.

“Out in the real world, this is what’s happening — it’s imploding. You would expect safe clients like Cambridge colleges to be ploughing on with their schemes but if they have to got to raise, say, £8 million over the next three years, they are telling the architect to go away because it’s not going to happen. Work is being stopped by text message in some cases.”

A number of firms across the UK contacted by BD this week confirmed that they had been forced to make redundancies in the past few weeks, with many others saying they were considering such action.

Chairman of housing specialist PRP, Andy von Bradsky — who said his firm had recently laid off a “small” number of staff — admitted that the practice had been taken aback by the collapse of the financial markets.

“If there was any doubt it was going to be difficult, the last couple of weeks have dispelled that,” he said. “Overseas is not a panacea. It presents its own problems, and it doesn’t necessarily soak up surplus staff in the UK.”

Roger Stephenson, partner at Manchester-based Stephenson Bell and outgoing president of RIBA North West, said he had made five staff redundant in the past month. “Anyone who is seriously involved in housing is really badly hit,” he said. “I’ve heard of firms having cut up to a quarter of their staff. These are reasonably sized practices.

“You really have to plan pessimistically. Only count cast-iron projects as future cash flow.”

Graham Morrison, partner at Allies & Morrison, said the firm had so far avoided laying off any of its 270 staff but added that he feared for friends in the profession.

“We have friends who are being made redundant,” he said. “That is the tragic thing — you’re dealing with people’s lives.”

We would love to sound like we have a strategy… but it is very difficult to plan when cataclysmic things happen at such short notice. I don’t believe anyone has any real strategy.”

Even Stirling Prize winner Feilden Clegg Bradley Studios admitted it was nervous and was making plans to cope in the event of a recession. These include further collaborations with other practices and increasing workload abroad.

“We’ve not had to lay people off yet, but we have to prepare ourselves because projects can falter at any moment,” senior partner Keith Bradley said.

“We’re sort of hopeful but it depends each month on winning competitions. We have submissions for Ojeu going out each week and if we can win our fair share, we’ll still be in business.”

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