During the 2008 recession, there was a lull in construction work and many skilled trade workers were laid off. They turned away from construction and moved into other fields. While the economy picked back up and the construction industry is booming, there is a large and unavoidable construction labor shortage. Due to the construction labor shortage, companies are having to find new ways to recruit qualified trade contractors and others.
(Graph by FRED St. Louis using data by the U.S. Bureau of Labor Statistics)
What Caused the Labor Shortage
During the construction slow down of 2008 and subsequent years, there were many layoffs in construction. Residential construction was impacted first which tumbled into commercial construction resulting in thousands of lay offs. When this happened, workers tried to find jobs in construction, and other fields. Many of those that left the construction industry haven’t returned even though it has picked up, because they’ve been working in the new field for 10 or so years.
One of the other big causes of the construction labor shortage is a reduction in the number of shop classes and the societal pressures around young people. Years ago a job as a mechanic, electrician, or plumber were thought of as good decent work. They were jobs where you could raise a family have a good life. The perceptions around these jobs have changed, and more people are pushing their kids towards college than towards the trades. The belief is that a college degree will give their children a leg up in life and ensure them a good life. However, trade professionals can earn as much as some college graduates or even more. And people will always need plumbers, electricians, and finishers. The societal changes in the perception of trade craft is one of the causes in the construction labor shortage.
What are the Potential Impacts of the Labor Shortage
The construction industry is feeling the impacts of the construction labor shortage. There were over 300,000 open construction jobs in January alone with that number to continue to rise. And with the aging worker population, there will be a continued decrease in workforce. If there isn’t enough people going into trade schools and apprenticeships, then there will be an increase in project completion times, and it could take longer for construction projects to get started. Individual companies will have issues with securing projects if they can’t predict whether they’ll have enough workers, and overall it will be hard on the construction industry.
Tips for Remedying Construction Labor Shortage
While it might feel like the labor shortage is out of a company’s hands, there are ways for companies to try to stay ahead of the curve. These tips should help your company avoid the strain of the construction labor shortage.
1. Know Your Busy Season
One of the easiest ways to stay competitive is to know when your busy season is. If your busy season starts in summer, then you should post the job in spring. This way you have a couple of months to interview potential hires before you’re strapped for employees. You can choose the best candidate and be selective, rather than taking whoever. Since you have time to vet potential candidates by hiring early. Also, hiring sooner gives you the ability to train the trade workers on how your business works. So you don’t have to stress about getting them up to speed when your busy season starts and have a better edge in the construction labor shortage.
2. Clarity in Position
Another easy way to stay competitive during the construction labor shortage is in your job postings. Specifically, clarity to the position you’re hiring for. The more information about the job, the more likely you are to get the right candidate. You will have to sift through resumes from candidates you’re not interested in if a job posting is too vague and doesn’t offer enough information. A job posting is also a great place to offer insight into what you’re looking for in a candidate, your minimum requirements, your preferences, and what it’s like to work at the company.
3. Showcase Reasons to Work at Your Company
Potential applicants should know why they should work at your company. More young people are looking for companies that offer a work-life balance, competitive pay, and benefits. The best way to showcase why trade workers should work for you is to use social media to portray what it’s like to work for your company. If you have holiday barbeques, Christmas parties, and paid time off, advertise these qualities to potential trade workers.
People want to work for companies that will appreciate them, not just offer competitive pay. Company culture is especially important during the construction labor shortages. Trade workers will look for other opportunities if they’re not fully satisfied with their position, the company, or any other reason. And in this construction labor shortage, it’s important to showcase why skilled trade workers should choose you over other opportunities.
(Photo by Pixabay.com on Pexels)
Offering apprenticeship positions and pairing with local trade schools is a great way to beat the construction labor shortage. Not only does it allow you to give back to your community, but you get extra temporary labor. And if the apprentice works well with your crew and has skills and character traits you want in an employee, you can hire them on full-time. This gives you a leg up on other companies looking for trade workers in this construction labor shortage. Internships are also a positive way to groom employees into becoming part of your business.
5. Pay Employees for Referrals
Employee referrals are a great way to find candidates. Employees are likely to refer friends from trade school, or they know from old jobs. And the employees will probably feel responsible for the friends they refer because if their referral isn’t a match or doesn’t work out, it will reflect on them. So employees will only refer trade workers they want to work with who are qualified. Employee referrals give you a highlighted group of individuals to choose from who have been recommended. And by using creative incentives, people are more likely to refer qualified candidates giving you a leg up on the construction labor shortage.
6. Use Technology
Technology is a quick and easy way to be able to mitigate issues that you face with the construction labor shortage. Project management software specifically can help keep the field and office informed and improve overall productivity.
So long as unemployment is low, it will be very hard for all businesses to fill positions. It’s especially hard in the construction industry as roughly 2 million skilled trade workers left the field due to the recession and most high schools de-emphasized trade training. It’s up to construction companies to stay competitive during the labor shortage. Through showcasing what your company has to offer and beginning the hiring process early, you’ll be able to attract the right trade workers at the right time this year.