An empirical analysis of commitment to health and safety and its effect on the profitability of UK Construction SMEs

The construction industry contributes one in six industrial fatalities per year with approximately 60,000 deaths on construction sites around the world. Undeniably, health and safety in the UK construction industry has improved significantly; however the industry is still considered as one of the most dangerous, responsible for 39 fatalities in 2012/13. Unfortunately, Small and Medium-Sized Enterprises (SMEs) in construction account for 90% of these fatalities at work. However, some may assert although not at zero accidents, large companies have got health and safety ‘just as good as it can get'. Arguably, an average SME’s health and safety performance is often undermined by a rigid dichotomy between perceived need for commitment to health and safety and profitability. Some proponents of commitment to health and safety claim that upholding safety best practice is, without doubt, the most crucial investment that can be made. However, there is substantial cynicism by most SMEs as to this claim; and it is often the case that financial pressure and the disbelief about returns on commitment to safety make SMEs cut corners. Attempts by past studies to measure commitment to health and safety against the profitability of organisations, seem to be scarce. Thus, this study aim is to explore the role of organisations' commitment to health and safety in the profitability of construction organisations. Construction firms that are committed to health and safety may reap the benefits of: having cleaner sites, better-motivated workers, reduced insurance premiums, avoid unexpected cost of safety, better productivity and thus better profitability. The study employed a mixed methods research design over two phases. The first phase was conducted using key SMEs operating in the UK to derive the influence of SMEs' commitment to health and safety best practice against profitability. Eighty seven participants representing various firms completed a questionnaire. The profitability over five years of companies for whom the participants worked was determined by reference to company’s accounts published at Companies House Ltd. In the second phase, semi-structured interviews were conducted with ten industry practitioners and two academics; in order to support the development of discussion and conclusion. The research findings show that SMEs' commitment to health and safety is good but falls short of being very good, excellent or outstanding. The study conclude that, there is a relationship between percentage commitment to health and safety and the profitability of organisations; in addition the study also inferred that remedial costs of safety (depending on severity of adverse safety incident) is likely to negatively affect the profitability of organisations.