Employee turnover can have a negative impact on any industry, but the effects are even more harmful for construction companies and contractors. Any construction employer knows in the highly specialized construction industry, project completion is at risk when a top engineer, heavy machine operator or journeyman carpenter decides to leave the job.

Employee Turnover Problem

This is especially true in the construction industry of today. The U.S. is experiencing a massive shortage of skilled workers. The U.S. Bureau of Labor Statistics reported that the construction industry added 282,000 new jobs over the last year due to high demand. Yet, the Associated General Contractors of America (AGC) reported 81 percent of members are having a hard time filling open positions.

That’s why it’s important for the construction industry to manage turnover and retain those highly skilled employees. Without a focus on employee engagement and retention, your crew might easily find a better opportunity at another company.

One way to manage turnover is to practice the principles of good management.

The Construction Industry Institute says construction companies often lack structured, formal workplace management strategies, meaning employers are failing to pinpoint the reasons why skilled workers are seeking jobs elsewhere.

Best practices from the HR world can help your company become the exception, rather than the rule when it comes to retention in the construction industry.

Reducing Turnover with Great Recruiting and Onboarding

What many employers fail to realize is that reducing turnover and retaining employees starts as early as the recruiting and onboarding period.


The candidate’s interview experience can shape their opinion of your company. Are your job ads inclusive to diverse candidates? How is the interviewer presenting the benefits of working at your company to candidates? What is the candidate interview experience like?

In a LinkedIn study, 83 percent of respondents said a negative interview experience would impact their perception of a company. Ensure hiring managers are comfortable interviewing and have their facts straight about company incentives and benefits. If multiple people are interviewing the candidate, the same company information should be provided to the candidate from each interviewer to avoid confusion about the job and/or benefits. Consider asking a personable and friendly employee to conduct interviews or provide training on the best interview procedures.

On the other hand, asking retention-focused interview questions can help determine a candidate’s interest and future dedication to the position. Ask performance-based interview questions like:

  • What is an example of a time you had to make a difficult decision? What was the outcome?
  • What is an important personal goal that you set and accomplished? How did you accomplish that goal?
  • How would you manage a situation where many different tasks are given to you at once?

By asking performance-based questions, you can more accurately predict the candidate’s work ethic and reliability. If they provide strong responses that indicate accountability and perseverance, your odds of retaining that employee are potentially greater.


Employers who go through a formal onboarding process are 70% more likely to stay with a company for 3+ years. Many construction companies still use manual forms that can lengthen the onboarding process if a new hire doesn’t fill out the form properly or if the paper form is misplaced. With an online onboarding system, new hires can fill out their federal and state work forms from their mobile phones, as well as input direct deposit information. Paperwork aside, there are many onboarding practices that help retain construction employees.

Mentorship Programs

Setting up a mentorship program during the start of a contract can aid in retention. Similar to apprenticeships, mentorship programs help new hires become acclimated to their job, company culture and co-workers.

Frequent Check-Ins

Regular employer-employee check-ins are a way to diagnose problems before they occur. Creating an environment where project and crew supervisors feel comfortable coming forward with employee conflicts will empower staff members and reduce issues on site. Ultimately, it’s about creating a workplace where there is mutual respect between managers and employees.


Since construction projects come with tight deadlines, try sharing with your employees the goals they have to meet. Linking their piece of the puzzle into the bigger picture will make them feel part of the project as a whole, and encourage productivity so the project can move on to the next step.

Competitive Pay

A common misconception is that money is the sole factor in retaining top employers. This is not true, so long as employees are paid a wage consistent to competing companies. The U.S. Bureau of Labor Statistics has outlined the average pay grade of employees in the construction industry, and their tables are a good way to ensure your pay meets industry benchmarks.

Supporting Productivity and Retention

Once you’ve started the management practices to eliminate employee turnover, it’s time to ensure employees are working as productively as possible. Happy employees are 20 percent more productive in their jobs and when employees are happy, they’re more likely to stay with their current company. There are many ways managers can support a happy, productive workforce.

Benefits that Matter

Providing benefits that are important to construction employees will make them more loyal to your company. Traditional benefits like contributing to their 401(k), offering health insurance and PTO are essentials in retaining construction employees. Consider thinking outside the box with benefits like gym memberships, tools or performance-based rewards like auto-detailing or gift certificates.

On-the-Go Learning Opportunities

When employees are confident in their abilities, they will work more productively with less supervision. A mobile-friendly training solution can be useful if employees have a few spare minutes in between projects.

Workplace Culture

Your workplace culture matters. Do employees enjoy coming to work each day? Are they friendly with their co-workers? Implementing a peer-to-peer recognition system can help boost morale on the job site. Fun team-building activities or volunteer opportunities are another option to explore that can help employees find common ground.

Health and Safety

There’s no doubt that the construction industry involves more physical labor. That’s why there must be an added emphasis on employee health and safety. This can come in the form of bigger picture items such as health benefits for muscle strain and repetitive motion disorders, to everyday items, such as making sure your staff has access to a cool, covered place to take their breaks, and ample food and water. Not only will this ensure your employees are safe and physically at their best, but investing in an employee’s health and happiness has proven to make them more productive on the job.

Taking your management strategies up a notch can play a huge role in employee satisfaction and retention, and help avoid some of the under-staffing issues that are plaguing the construction industry as a whole.

Learn how you can recruit and retain the very best by reading The Ultimate Guide to Retaining Employees.

Read the Guide