According to the Home Builders Institute, the construction industry needs an additional 2.2 million workers between now and 2024 to keep up with construction expansion and worker replacement. News outlets have called the situation “staggering” and “desperate.” But nobody should be saying it’s a surprise — or temporary.
In the 2021 construction transition planning report issued by Wipfli, nearly 90% of construction leaders said they plan to start transitioning out of their companies in the next decade. Owners have been retiring and exiting the business in waves, taking a wealth of knowledge and skills with them.
Retirement is just one reason construction workers are walking way. Construction is tough, physical work. Sometimes, even dangerous. Companies have struggled to find workers who enjoy and thrive in the environment.
It’s also hard to retain workers when wages and opportunities are plentiful outside the sector. The labor shortage is a ubiquitous problem, so construction firms are competing against “cushier” and “easier” career offers.
These three factors — ownership transitions, recruitment and retention — add up to a serious and perpetual problem for the industry, and one that time and market conditions won’t fix. Here’s the hard truth: There will never be enough people to get the work done.
That’s not a cue to throw in the towel. Instead, to battle the construction labor shortage, it’s time to develop new strategies for talent acquisition and retention. Start here:
1. Assess before you engage
According to the Society of Human Resource Management, on average, it takes $4,129 and 42 days to fill an open position. Even then, there’s no guarantee you’ve got the right person, or that they’ll stay.
Pre-hiring assessments can help your firm shorten ramp-up time and shore up investments. Behavioral assessments like Predictive Index®, in particular, can “decode” candidates’ motivations and help place them on the right teams, right away.
Assessment-based hiring can guide interviewers toward the right questions and match new-hires with compatible managers and teams. A person’s motivation and drive — not just what they say during an interview — is an important indication of cultural fit. Assessments can also identify coaching tools and onboarding plans that are tailored toward individual needs.
2. Onboard during the interview process
It’s never too early to get on the same page. Use the interview process to introduce your mission, vision and values, and to start conversations about career paths and aspirations. Younger generations, in particular, are interested in meaningful work that aligns with their personal values. And workers who are looking for long-term career paths, versus a job, need to understand whether they have a future with your company from the very beginning.
3. Diversify the talent pool
It’s no secret: Construction is a male-dominated industry. Firms can expand their talent pools by recruiting more women and minorities into the field — and not just as token placements. In an equitable environment, more employees can enter the industry, impact outcomes and participate at the greatest level.
Construction firms also need to recruit new skillsets. Part of “doing more with less” is working more efficiently and with technology. Increasingly, employees will need technical and analytics tools, in addition to a skilled trade. Tomorrow’s leaders may not come from a job site.
4. Re-recruit your employees
“More people” isn’t a magic solution. Recruitment, onboarding and training are time-consuming and expensive. Firms can throw tons of money at recruitment and still lack the talent, skills and desire they need to deliver high-quality and consistent work.
The best HR investments are working for you right now. It’s your job to make sure people are in the right roles, given the right support and offered a longer-term career path.
If you don’t already:
- Study your workforce: If you don’t pay attention to your best people, somebody else will. Get to know team members and what makes them “tick.” Find out why people stay, what’s challenging them, and what has them “hooked.” Encourage supervisors to lead strong and spend meaningful time with staff.
- Actively listen: If you solicit employee feedback, ask with the intent to act. Expect tough messages, stay open to them and commit to action. If people are leaving, have an objective third-party find out why. It’s your responsibility to make the workplace better for the next person.
- Invest in leaders: There’s a saying, “People don’t leave their companies; they leave their boss.” Supervisors have tremendous influence over job satisfaction and retention. Make sure managers, superintendents and project managers have the skills, tools and support to lead well. Keep in mind, being good at a trade doesn’t always translate into being a good leader. Supervisors may need ongoing and advanced soft-skills training. Leadership takes time, too. There’re no short-cuts for building relationships, communicating and training.
The talent gap is our “new normal.” The good news is, construction firms can execute contracts, secure new business and increase company value with the people they already have. The key is to hire the right people, train them well and develop solid career paths for them to follow. When employees are engaged in the work, they can — and will — do more to move the company forward.
How Wipfli can help
Wipfli can help you tackle the construction labor shortage. Our professionals specialize in business strategy, labor planning, business transition planning and other critical operational services specifically for construction and real estate firms. Together, we can build a better future.
Explore our website to learn more, and subscribe to receive additional construction news and content in your inbox.
In the next article in our series on tackling disruption in the construction industry, we’ll cover how to tackle the future when it comes to succession planning and transitioning the business.