“No one wants to work anymore” and “I just can’t find good people that want to work.” I hear it all the time, but I’m not really seeing it. Every company is experiencing a labor shortage. The best of them are not being passive about it. They are taking action. So, what are the great companies doing that others are not?
Understanding the Construction Labor Shortage
There is plenty of work to do. If a shortage of qualified people wasn’t a limiting factor, the construction industry would be growing. There is a global demand for better infrastructure, affordable housing, and everything related to artificial intelligence. The industry continues to struggle to meet this demand with the available workforce.
The construction industry’s labor shortage has two primary contributing factors.
One major issue is the aging workforce. Many experienced workers in the industry are retiring, and there are fewer skilled, young people available to replace them.
The industry also has a perception problem: construction work is considered to be physically demanding and low-paying. This perception discourages younger folks from pursuing careers in our industry.
If we can understand the causes and challenges, we can come up with solutions. With fewer skilled workers, the existing workforce feels stretched, projects are experiencing delays, profitability is down, and company/industry growth is limited. Additionally, many companies are forced to lean on their subcontractors and use temporary workers, which can compromise quality and consistency of project delivery. This can also lead to burnout and safety concerns. So, the shortage of labor is impossible to ignore. There is too much at stake.
What Can Be Done About It?
The short answer is, “do something”.
Don’t be passive. While the labor shortage is real and complex, there are several strategies that “best in class” companies and trade organizations are adopting to mitigate their challenges. The top four are: train and develop, onboard with intention, help reframe the perception of the industry, and become a great company to work for. Start with where you are and what you have.
Train & Develop
The forward-thinking companies are increasing their capability by developing their people. If you are frustrated with the lack of skill in your workforce, train them. It’s simple, but not always easy.
One of the most effective solutions is to provide internal training and apprenticeship programs. These programs primarily target the field (labor, foremen and superintendents) with leadership, business acumen, and technical training. Both union and non-union companies are taking on the responsibility of teaching their workers how to plan and perform work, the “company way”. It takes extra time and money AND there is a measurable ROI (return on investment). These programs improve the skills of the new and existing workers, help companies do more with fewer crews and, improve retention. The ROI shows up in safer jobs, more productive project delivery (lower costs) and fewer quality and rework issues.
The old model of OJT (on the job training), just isn’t working like it used to. Doing nothing (or relying on OJT) is definitely more costly and risky than doing whatever you can, to actively, develop your people.
Also, a few clever companies are partnering with trade schools, vocational training programs, and community colleges to create construction and craft training programs. Then selecting the “cream of the crop” from the graduates. All of these efforts help the companies and the industry.
Onboard with Intention
I am seeing more and more companies implement robust “onboarding” programs, which act as an extended screening process. The typical programs are designed so that participants will learn about the company and the key, basic field skills they will need to be effective, day one on the job. They also have to show up with a good attitude every day for a week in order to graduate into full time employment. They hit the field with a baseline capability so they are productive sooner with less field disruption. The “graduates” are more confident about what is expected of them and they begin to feel like they are a part of the company much sooner. These programs also make the hosting companies more attractive to young workers looking for a place where they can grow and make money doing it.
The best onboarding programs have an attrition rate by design. The clients I have spoken with expect it. They say “I would rather have a new employee leave during onboarding than two months into the job after they have inflicted a bunch of delays, and conflict upon my field”. The ones that stay are staying longer. Turnover is costly. Onboarding ROI shows up in more productive effort sooner and greater retention.
Reframe the Perception of the Industry
The industry needs to improve its image, especially among young people. By showcasing the benefits of construction careers, such as competitive wages, job stability, and opportunities for advancement, more individuals may be encouraged to pursue jobs in construction.
Construction is hard work for those that select the field, but not all construction jobs are in the field. There are plenty of financial, project management and administrative jobs in the industry, too. The work is also very rewarding and necessary. I suppose I am a little biased. I love this industry and want others to see it the way I do: a great way to provide for your family with a lot of diverse opportunities for learning and development and a long, successful career. The truth should be enough. I know a lot of superintendents that are millionaires (but they aren’t bragging about it).
Become a Great Company to Work for
Finally, the most competitive companies are addressing the challenges of long hours, physical strain, and workplace safety to attract and retain workers. They are starting to offer better benefits, health insurance, paid leave, and retirement plans, to make construction jobs more attractive and help reduce turnover. The best companies are creating cultures that are extremely attractive to the next generation of workers, starting with caring for people and their families. It’s not always about the money. Young people want a great place to work and to feel a part of something larger than themselves. Frankly, that’s an easy one. The construction industry builds America, for heaven’s sake.
Conclusion: Leading Through the Labor Shortage Challenge
The labor shortage in the construction industry is a pressing issue that requires concerted effort to mitigate. The “best in class” companies that invest in training and development, onboard with intention, help reframe the perception of the industry, and become a great company to work for are benefiting with more applicants, higher retention and better performance. These solutions will not only ease the burden on current workers but also ensure that your company (and the industry) remains sustainable and competitive in the future.
Need support for your Construction Business? Andy can HELP.