A future return to EU free movement could give London construction access to a larger labour pool, but the same policy could also add to housing demand in a city already planning for far fewer homes than its assessed need.
Prime Minister Andy Burnham has said he is open to an "honest discussion" about the UK's long-term relationship with the European Union, including options that could eventually involve the single market or EU membership and therefore free movement. No such change has been agreed. Labour's existing commitments to remain outside the single market, customs union and free movement remain in place, and Burnham has said a different settlement would require an electoral mandate.
The immediate UK-EU negotiations are narrower. The 20 November summit in Brussels is expected to cover food and drink trade, energy, youth mobility, security and migration cooperation. For construction, however, the longer-term debate raises a harder question: could easier movement of European workers help London build more homes at the same time as population growth increases the number it needs to build?
Building works and everyday street activity in central London. The capital faces simultaneous pressure to expand its construction workforce and increase housing delivery. Photo: London Construction Magazine.
London already needs thousands more construction workers
London's construction workforce is already below the level required by its housing and infrastructure pipeline. City Hall's 2026 construction-skills programme cites Construction Industry Training Board forecasts showing that the capital will need more than 26,500 additional construction workers by 2028, with demand across carpentry, bricklaying, electrical work, plumbing, quantity surveying, supervision and engineering roles.
The national problem continues beyond that date. The CITB Construction Workforce Outlook 2026-30 estimates that the UK will need an average of 41,200 extra construction workers a year between 2026 and 2030 as output recovers and workers leave the industry.
London has historically been more dependent on European labour than most UK regions. Earlier Office for National Statistics analysis found EU nationals accounted for 28% of London's construction workforce before Brexit, with the proportion higher again in the construction-of-buildings sector. The precise composition has changed since then, but the direction is clear: London remains unusually exposed to changes in international labour supply.
More recent City Hall payroll analysis shows 677,000 London employments were held by EU nationals in December 2025, down from 846,000 in 2019. Construction remains one of the London sectors with a relatively high EU workforce share.
LCM examined the same issue earlier this year in its analysis of immigration and UK construction workforce risk. The central problem is not simply headcount. Contractors need workers with the right trade skills, site experience, competence, supervision and evidence required for the work they are being asked to deliver.
Free movement could remove a recruitment barrier
If full free movement were restored at some point after a future election, contractors would no longer need to rely on the current work-visa system when recruiting eligible EU workers. That could make it easier for bricklayers, carpenters, electricians, MEP specialists, engineers and other construction workers to take jobs in London or move between UK and European projects.
The effect could be particularly relevant to subcontracting, where labour demand can change quickly as projects move from structure into façade, MEP, fit-out and commissioning. Sponsorship rules are a poor fit for some short-duration or fragmented work packages, particularly where workers are employed through smaller specialist firms.
That would not remove the need for domestic training. London is already investing in apprenticeships, colleges and construction skills facilities, including the new NHBC training hub at Barking Riverside. LCM's earlier analysis of the Barking Riverside training hub and London's housing workforce gap showed why the city needs both new entrants and experienced site workers.
Nor would free movement make every worker immediately deployable. Competence requirements, CSCS routes, trade qualifications, employer checks and project-specific training would still apply. The construction sector would also remain subject to enforcement around illegal working, labour exploitation and subcontractor compliance.
More migration would also affect housing demand
The other side of the equation is housing. London's existing need is already well above current delivery capacity before any future change to free movement is considered.
The Draft London Plan is planning for about 558,000 homes between 2027 and 2036, equivalent to roughly 55,800 a year. Government's standard-method assessment puts the capital's need at about 84,900 homes a year, while separate GLA analysis has placed overall need at around 89,300 a year.
LCM has already examined the gap between the Draft London Plan's 558,451-home target and the roughly 850,000 homes assessed as needed over the decade. The difference exists before any new migration policy is added to the calculation.
A return to free movement would not translate automatically into a fixed number of additional homes. Some people would move temporarily, some would share accommodation, some would leave again and others would settle with families. The effect would depend on the scale, age profile and duration of migration, where people worked and whether net migration actually increased.
The latest ONS long-term migration estimate puts UK net migration at 171,000 in the year to December 2025, down from 331,000 a year earlier. EU net migration was negative, meaning more EU nationals left the UK than arrived over that period.
If that pattern reversed under a future mobility agreement and London attracted a large share of the additional workers, demand would be felt first in rented accommodation and lower-cost housing. London's affordable-housing problem is already substantial: City Hall's 2026 assessment puts affordable housing need at about 45,500 homes a year.
The labour and housing effects would pull in opposite directions
| Potential change | Possible effect on London construction |
|---|---|
| Larger EU labour pool | More recruitment options for trades, technical staff and specialist subcontractors |
| Lower immigration friction | Easier movement between European and London projects, particularly for short-duration packages |
| Higher sustained net migration | Additional demand for private rented, market and affordable housing |
| Greater site capacity | Potential to deliver more housing and infrastructure if finance, approvals and projects are ready |
| Poor skills match | Headline labour numbers rise without solving shortages in experienced or regulated roles |
More labour would not fix London's housing pipeline on its own
London's housing shortage is not currently caused by a single constraint. Planning capacity, development viability, finance, affordable-housing funding, infrastructure, Building Safety approvals, market absorption and contractor capacity all affect whether a consented scheme reaches site.
LCM's September analysis of the London housing delivery gap found that the capital has a substantial pipeline of planned and consented homes but continues to struggle to convert that pipeline into physical construction and completed units.
A bigger workforce could remove one constraint. It would not make an unviable residential scheme financeable, secure a Gateway approval, fund affordable housing or create private buyers. Equally, restricting labour supply does not reduce London's existing housing requirement; it can make the homes already needed harder to build.
That is the construction tension behind the free-movement debate. London could gain workers capable of delivering more housing while also gaining residents who need somewhere to live. The balance would depend on whether additional construction capacity converts into completed homes quickly enough to keep pace with any extra household formation.
The first test comes before any free-movement decision
The next formal step is the UK-EU summit in Brussels on 20 November. The government is seeking agreements on food and drink, energy, youth mobility and migration cooperation. Full free movement is not part of the current agreed negotiating position.
Any later move towards the single market or a wider free-movement settlement would require a separate political decision and, on Burnham's current position, a general-election mandate. Until then, London's contractors continue to recruit under the existing immigration system while City Hall works against a construction workforce requirement of more than 26,500 additional workers by 2028.
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