Have architects learned anything from the financial crash of 2008, whose reverberations the world is still reeling from until this day?
The financial crisis of 2008 almost decimated the architectural profession. It caused an avalanche of job losses, bankruptcies and redundancies. It led to offices competing to the death for dwindling work, slashing fees and offering services for free. It has effected a significant plummeting in earning power. It has meted out misery to so many people. To cut a long story short, It has shown how precarious the world of property and construction is.
And the lethargic market carried on for years: As it began to convalesce, the Brexit referendum added an air of uncertainty that caused developers to get cold feet and led to projects being discontinued. Then the Covid 19 pandemic happened. Not only this, but wage growth has stagnated as a result and architects now earn exactly what someone at their level would have earned in 2008. Only, the cost of living has increased significantly leaving anyone in this profession with a conundrum: stay put and suffer from a deteriorating standard of living or job hop to (barely) keep up with one’s standard of living at a great cost to stability.
It would be facile to chalk up the tumultuous decade to bad luck, and it would be easy for architects to get addicted to eliciting sympathy from others about their plight because it is not totally wrong. But it is also not totally right.
Given how persistent this sluggish market has been and given how often it happens, how has the profession reflected on the experience and how has it adapted to roll with the punches, nay, how has it kept up with the times in general since the 1980s?
From my personal experience, not much if not at all. Offices repeat the same mistakes. To quote Rita Mae Brown: “Insanity is doing the same thing over and over again, but expecting different results.” The architectural profession is so failing and the business model is so obsolete it is rather embarrassing. The global economic order has changed significantly since the 1980s; yet, the architectural profession has not received the telex.
So how can architects learn from the nadir of the last 14 years?
1-Agility Practices’ recruitment processes are a triumph of hope and optimism over common sense. Recruitment is fueled by project needs rather than the long-term needs of the company. Some companies err on the side of caution and strive to keep the headcount at a certain number but many succumb to the pressure of new work to expand the team. Because projects can pause and stop at the drop of a hat, many companies find themselves in this vicious circle of recruitment and redundancies. How can companies be more agile and intelligent in their recruitment process? One suggestion is to keep a core team of the right mix of skill set and talent and rely on contractors/ consultants. Contractors are well aware of the ephemeral nature of their contracts but they should be compensated adequately for their risk. The last 10 years gave rise to short-term contracts which, in my opinion, are criminal because they offer people neither the rights and job security of permanent employment nor the risk premium of contract work.
2-Scope of Services Architectural practices relish adding more to their scope of services as it gives them the erroneous impression that they are pivotal to the property and construction process. Little wins like waterproofing packages and underfloor drainage act as a force of resistance in the face of changing times and loss of prestige. These soul-corroding little wins arguably augment the fee (by a pittance really) but be that as it may, taking on more scope requires more resource that would ultimately eat into this fee and profit margin but also sometimes force companies to recruit new staff who may end up being made redundant if the project stops.
3-Outsourcing If, for some reason, architects have to compromise on how much they add to their scope, they can outsource a lot of the production and documentation. Many packages can be outsourced to third parties which is expensive in principle, but still a more risk-averse approach that the revolving door of recruitment and redundancy.
4-Rethinking Our Role The architectural business model has remained unchanged since the 1970s despite the cataclysmic changes that have altered the economy and the world around us, leaving the profession bereft in an increasingly alien landscape. I have argued often that we have failed to specialise and embrace architecture as a service rather than just a product. A Luddite profession obstinately refuses to take stock and explore new horizons. I have been writing about this for 2 years, about how many opportunities the profession misses out on and about how everyone else profits off our discipline. The profession has not questioned whether the obsession with construction is healthy, whether the role of architects in a consumerist society should change, whether there are new revenue streams we can probe.
Architecture is predicated on design and innovation as well as on research and development. We have the tools and training to manufacture taste, to create virtual worlds for the gaming, film and television industries, and to act as mediators between developers and game/ film companies.
Architecture comprises so much innovation, so much imagination and so much pleasure that is weaved into everyday life that everyone interacts with in some way or another. It really does not deserve to be strangled by such a joyless and rudderless profession. So much wasted talent and so much wasted potential have been lost over the years by a business model that ignores the writing on the wall. This business model has had its chance and it blew it so isn’t it time for the architectural profession to radically reinvent itself?
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