No matter what economists predicted for 2023 (slowing economy, raising the debt ceiling and avoiding a recession) nationwide labor shortages paired with increased work demand have been the top construction workforce challenges for construction companies this year.
According to the US Bureau of Labor Statistics, there were 347,000 job openings in construction in April 2023 and 392,000 in May. The Associated General Contractors of America (AGC) notes that employment is increasing but contractors are having trouble filling job openings, especially with industry unemployment at 3.5%. The numbers reflect a growing demand for construction work but not enough workers to keep up.
Yet finding enough bodies to fill positions is only part of the issue. Retention is key to building a solid workforce that construction companies can rely on for the remainder of the year. Keeping your employees around may mean acquiescing to some of their demands, like earning higher wages and learning new skills. But it also means restructuring recruitment efforts to ones that can lure the best candidates away from your competition.
Workers Want Higher Wages
Enticing candidates to accept your positions might require increasing what you pay. Workers continue to want to make more money and for good reasons. According to the Bureau of Labor Statistics (BLS), the consumer price index rose 3% over the past 12 months. The biggest increases were shelter, food and medical care; shelter accounting for 70% of the increase. As these costs continue to rise, workers will either demand a higher wage to cover them or look at competitors who will pay them more.
If budgets won’t accommodate higher wages, consider reevaluating your benefits packages to include items that employees demand and that will set them apart from the competition. For example, offering flexibility like tech breaks, letting workers self-schedule or switch shifts and encouraging PTO. There are also various health and wellness benefits that will strengthen your workers like gym memberships, fitness trackers, health screenings, smoking cessation programs and stress management education.
Bigger Need for Specialized Skills
As the construction industry gets more technically advanced, the increased need for specialized skills will only grow and workers will want to learn how they can advance their careers. In the last couple of years, technology in construction has skyrocketed to include things like:
- Augmented reality
- Smart construction wearables
- Construction exoskeletons or exosuits
- Factory, collaborative and autonomous robots
- AI and machine learning
- Modular construction
- 3D printing
- Building information modeling
With all the technological advancements, construction workers must be more specialized than ever. Offering learning and development programs that teach workers new skills will give employees the skillsets they want, and your company needs.
Lack of Qualified Workers
A good training program also helps fill in your basic skills gaps. Currently, construction companies are losing their most skilled workers, i.e., Baby Boomers. According to the US Census, all Baby Boomers will be retired by 2030. This generation makes up a huge portion of workers in the construction industry. Training unskilled workers could be a solution if recruitment efforts can’t bring in enough skilled help plus more workers demand it.
According to a Gallup survey, 65% of workers believe employee upskilling is very important when evaluating a potential new job and 48% said they’d switch to a new job if it offered skills training opportunities.
Convincing Young People to Get into Construction
Training workers is only one solution to the labor shortage. It’s difficult to boost numbers in construction when fewer young people are entering the industry. According to the BLS, 60% of 2022 high school graduates ages 16 to 24 were enrolled in colleges or universities. The focus on pursuing higher education over a trade has steadily increased over the past 40 years. According to the National Center for Education Statistics, in 1969 there were 8 million students enrolled in postsecondary institutions and in 2019, 19.6 million were enrolled.
Recruiters need to push the benefits of construction to potential workers, including those who are still in high school. These benefits include:
- Ability to earn money from day one through paid on-the-job training
- A variety of available positions for a variety of skill levels
- Free from tens of thousands of dollars in debt from student loans
Attend high school job fairs, offer mentorships to students and find other ways to keep your doors open to students to help promote any interest in starting a career in the construction industry.
Competing with Other Industries for Workers
Recruiting efforts also need to be competitive, highlighting why your company is a better fit than others. According to the US Chamber of Commerce, labor shortages are impacting several industries that show a number of unfilled job openings:
- Wholesale and retail trade – 20% unfilled
- Leisure and hospitality – 35% unfilled
- Durable goods manufacturing – 25% unfilled
- Professional and business services – 65% unfilled
- Financial activities – 50% unfilled
With several industries facing worker shortages, construction companies will have to work even harder to recruit workers to not only their company but the industry as a whole. Promoting your company culture and benefits shows candidates that construction is a growing, viable industry. In 2022, more than 50 million workers quit their jobs looking for better work/life flexibility, better pay and strong company culture.
Overcoming workforce challenges for the rest of 2023 and into 2024 can be easier when you use HR technology, which can give you an edge over the competition when it comes to recruiting and retaining workers.
Download our guide, Meeting 2023’s Top Construction Workforce Challenges: The Year So Far, to learn how HR technology can help grow your workforce.