The UK water sector risks falling into a familiar cycle of late-stage pressure and rising costs unless it addresses the underlying cause of the slow start to AMP8, according to specialist recruiter Murray McIntosh.
The group – an expert in hiring solutions for the water industry – has warned that AMP8 has effectively begun at ‘Year 0’, marked by stalled programmes, delayed decisions and a growing talent drain.
While headline investment figures indicate progress, an overlap between AMP7 and AMP8 project delivery has blurred timelines and masked genuine delays in AMP8 delivery, with much of the industry still in planning and mobilisation despite a £104 billion investment.
The group says there is clear evidence that key deadlines are slipping, with projects originally expected by 2030 now extending to 2032 and beyond. Together, these factors are creating the conditions for a ‘perfect storm’, where delayed mobilisation leads to a surge of activity later in the cycle, increasing pressure on supply chains, costs and delivery risk for AMP8 and beyond.
According to Murray McIntosh, with AMP8 significantly larger than previous cycles, the risk is that the volume of work becomes concentrated into a shorter timeframe, placing unsustainable pressure on supply chains and increasing the likelihood of cost inflation and delivery risk.
Adam Cave, Founder and Managing Director at Murray McIntosh, said:
“The reality of the current AMP cycle is that AMP8 has not truly started yet. What should have been year one has effectively become year zero. Programmes paused during the regulatory process have not simply switched back on, and that lost momentum is now feeding into delayed decisions, cautious investment and a slower pace of hiring.
“The concern is not just where the sector is today, but where it is heading. If mobilisation continues at this pace, we will see a significant build-up of work in the middle of the AMP, much like we saw in the last cycle. That brings supply chain pressure, rising costs and increased delivery risk. The decisions made over the next 12 months will determine whether AMP8 delivers as intended or whether the sector tries to recover lost time under intense pressure later.
“The impact is already being felt in the labour market. We’re seeing a growing reliance on contract hiring as companies prioritise speed and flexibility in an uncertain environment. There’s no doubt that this contingent capability will be essential to bridging immediate delivery gaps across AMP8 as the required scale of the permanent workforce simply doesn’t exist in water. At the same time, though, there is still no coordinated view of workforce demand across the sector, with companies planning in isolation despite the unprecedented scale of AMP8. The transition to a new regulator is adding further uncertainty and delaying key investment decisions around staffing. A more strategic blend of contingent and permanent hiring, underpinned by greater collaboration on workforce planning, will be critical to ensuring the sector can deliver its commitments without placing unsustainable pressure on delivery later in the cycle.
“I find it generally staggering that the water industry is one of, if not the only, remit that has the luxury of being able to forecast demand five years ahead with precision, and yet human capital plans are reactive or under-resourced. That simply must change. Without a shift in approach, the sector risks storing up challenges for later in the cycle, and a more proactive, joined-up approach to delivery and talent will be critical if investment is to translate into sustainable outcomes.”
