‘Difficult and uncertain times’: Wave of redundancies hits top architects

AJ100 practices Buckley Gray Yeoman, Piercy&Company, Hawkins\Brown and HTA have all confirmed they are set to make redundancies.

AJ40 under 40 firm TDO also said it had reduced its headcount.

The news comes as industry tracker Glenigan reported a sluggish first-quarter performance, with project starts falling across all sectors by nearly a third (down 28 per cent) compared with the same period last year.

Social housing work has been particularly heavily hit – the number of projects starting on site fell 43 per cent on the preceding three months and by 40 per cent against last year’s figures.

The ripples of the slowdown are now hurting many practices.

Simon Bayliss, managing partner at HTA Design, said up to 15 people at the 230-strong company had been affected and that it had managed the reduction in numbers ‘through a range of measures, including sabbaticals and voluntary redundancies’.

Government prevarication and regulatory uncertainty has done damage

He told the AJ: ‘Many housing practices have been facing more difficult times over the past couple of years, with the economic conditions presenting significant barriers to development, while government prevarication and regulatory uncertainty have almost certainly done even more damage. In this competitive environment, it has unfortunately become necessary to reduce the size of our architecture team.’

Hawkins\Brown, which recently reported a record £33.7 million in turnover of and a bounce back into profits for the financial period ending 31 March 2023, blamed delays to ongoing schemes and clients reconsidering delivery timescales for its decision to let staff go.

We’ve seen a number of projects slowing down or going on hold in recent months

A spokesperson for the company, an Employee Ownership Trust since 2021, said: ‘Unfortunately, like many UK architecture practices and professional services firms more widely, we have seen a number of projects slowing down or going on hold in recent months. In these difficult and uncertain times, both economically and politically, our clients are reappraising how and when they can deliver schemes and we are having to react accordingly.’

They added that, to ensure long-term financial stability, the 275-strong company had ‘opened a collective consultation process with our staff that may lead to redundancies’. The number of people affected has not been revealed, however Hawkins\Brown told the AJ that its Los Angeles office was closed last month with its three UK staff returning to London.

Meanwhile, Piercy&Company confirmed it had made eight roles redundant from its studio of over 90 people.

A spokesperson said: ‘Just as with other practices, [we have] decided to make redundancies this year in response to multiple factors, including an industry-wide contraction and the ongoing financial downturn in the UK.

‘This was an extremely difficult process for all involved, as every member of the studio is highly valued. Despite the challenges, Piercy&Company has positioned itself to be stronger and more resilient through a combination of recent competition wins, confirming next stages on existing projects and robust financial management.’

Buckley Gray Yeoman, another employee-owned business, said it was also having to let some of its 100 staff go. A spokesperson told the AJ: ‘Due to the challenges we face in the industry as a whole, we have taken the difficult decision to reduce the number of UK employees to suit the amount of work we have secured.

‘We are taking all the necessary steps to support our staff and have offered secondment opportunities and voluntary redundancy to those at risk. We remain optimistic that we will generate more opportunities in the future.’

The AJ understands too that, late last year, social housing experts Karakusevic Carson Architects made around 15 staff redundant.

Practice founder Paul Karakusevic said that issues with ‘second staircase and different interpretations of the new regulations by fire engineers’ meant certain projects ‘did not advance’.

He added: ‘Hopefully we have turned a corner [and that a new government] and renewed focus on genuinely affordable and council building will help in 2025 and beyond.’

Earlier this month Alex Shall, a partner at accounting and advisory consultants Praxis, warned that a culmination of factors and the current financial crisis pointed to a tough year for UK architectural practices, adding that he expected ‘a significant number of UK architecture practices [to] fail this year.’

He wrote in the AJ: ‘Since the start of 2024, I have met with no fewer than three practices to discuss placing them into liquidation. For me this is completely unprecedented.’