Water nationalisation plans risk failure without urgent action on skills shortages

With Andy Burnham being touted to take on the role of Prime Minister in the summer following Starmer’s resignation, plans to renationalise the water industry could be fast-tracked. However, according to Adam Cave, Managing Director of specialist water recruitment firm, Murray McIntosh, renationalisation alone will fail to solve the sector’s legacy challenges unless it is backed by a clear workforce strategy.



Burnham has previously indicated that he would support a phased move towards greater public ownership of the water industry, with Thames Water likely to be among the first providers considered for intervention. However, Murray McIntosh has warned that any accelerated reform of ownership models risks overlooking the most pressing barrier to industry improvement: the shortage of skilled engineers needed to deliver change.



The warning follows findings from Murray McIntosh’s 2025 Water Industry Labour Report, which surveyed 4,391 engineers across the UK water sector. The research found that almost half (49%) of water engineers believe talent shortages, or the overall size of the skilled workforce, are the single biggest issue facing the industry, up from 26% in the previous year’s study. A further 66% of engineers said they are planning to leave the sector for another industry in the coming years, while 23% expect to retire within the next five years.



According to the report, skills shortages are already affecting delivery. Engineers told Murray McIntosh that the lack of available talent is leading to project delays, increased workloads, missed targets for AMP8, operational inefficiency, higher costs and lower standards.



Cave commented:



“Renationalisation may be politically attractive, but will it address the underlying issue holding the sector back? Access to people. Changing the ownership model will not, on its own, deliver infrastructure upgrades, improve environmental outcomes, reduce project delays or rebuild public trust. Those ambitions rely on having enough skilled engineers, project specialists and experienced leaders to turn policy into delivery. At the moment, that workforce simply does not exist at the scale required.



“The water industry is already entering AMP8 with a significant skills deficit. The sector needs a much more coordinated approach to workforce planning. Water has the unusual advantage of forecasting demand years in advance through AMP cycles, yet human capital planning remains too reactive. Companies are still planning in isolation, despite facing the same talent pool, the same project pressures and the same looming retirement cliff.



“Greater public control may reshape the financial model, but unless it also drives better collaboration across employers, supply chains, regulators and Government on skills, it will not deliver the transformation being promised. The future of water will be determined as much by workforce capacity as by ownership.”



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