There seems to be a bit of interest in the Severn Barrage at the moment, with our own Governor General claiming it will generate 40,000 new jobs, and Tony Blair making supportive noises. Sounds like excellent news for our struggling economy, and we should throw ourselves at the feet of Peter Hain, but lets not get carried away.
Looking at the positives first, construction activity is one of the best ways to stimulate the economy – it is labour intensive with a high proportion of locally sourced materials, and also has a high ‘multiplier’ effect – for every one direct job created it creates 2 or 3 additional jobs in service industries.
But there is a big difference between small construction projects and mega-projects such as the barrage. On smaller projects, for example local housing developments, the work is typically carried out by local builders, using a network of local available services and subcontractors, and most of the money spent stays within the local economy.
Even on the larger projects, such as the St Davids 2 development in Cardiff which will employ over 1,000, the majority of the workforce will be locally recruited, although many of the support services will be sourced at a UK level.
But this is not the case on mega-projects like the Barrage. The main contract will have to be put to international tender, and is just as likely to be won by an Italian contractor than a British one. The work will then be divided up into a series of subcontracts, which could see the main rock supply contract won by a quarry in Portugal; marine dredging works being done by a Dutch fleet; lockgates fabricated in France, and so on. There will still be a local requirement for labourers, carpenters, steelfixers etc, but mega-projects tend to attract an itinerant workforce, and you are just as likely to hear a Scouse or Geordie accent on site as one from the Valleys.
More realistically, I estimate that the barrage would only generate around 1,000 direct jobs in Wales, with maybe a similar number of indirect jobs – and lasting for only 2 or 3 years. In itself, that is a desirable result, but it is a long way off the 40,000 jobs promised by Peter Hain, but then again, when was the last time you believed anything that this idiot said?
Ps I am a Construction Manager and have worked for the last 20 years on international mega-projects similar to this one.