How to be Successful Despite The Skilled Labor Shortage | Cratos

Cratos

How to be Successful Despite The Skilled Labor Shortage

High impact tech tools

It is no secret that across the nation exists an often-concerning labor shortage. This problem has plagued the construction industry for an entire decade, continuing to grow ever more significantly with each passing year. In 2011, only 13% of contractors reported cost and labor availability as a notable concern, while in 2020, that number skyrocketed to 85%. During any given month, there is a shortage of 200,000 to 300,000 construction workers, inevitably causing project delays, increased costs, and an overworked skilled workforce. 

 

According to the Associated Builders and Contractors (ABC) analysis, in 2021, construction companies will need to hire 430,000 more workers than they employed in 2020. Even despite the global pandemic, skilled construction workers are still in demand. COVID’s lasting contribution has been to increase pressure on an already understaffed workforce. As is well documented, most laid-off construction workers leave the industry altogether, and with an already struggling labor force, the stress is on. 

According to the 2020 Construction Outlook Survey (www.agc.org) by the Associated General Contractors of America (AGC), 81% of construction firms have trouble filling both salaried and hourly craft positions, and 72% anticipate labor shortages to be the biggest hurdle they will face in 2021. 

The survey also highlights the results of the skilled labor shortage in construction:

  • 57% of companies believe that skilled labor shortage is the biggest challenge to worker health and safety 
  • 44% of companies have experienced higher project costs
  • 40% of companies cite longer completion times
 

Ultimately, an inexperienced labor force can result in higher injury and fatality rates, increased cost delays, and decreased work quality. These effects can be devastating for smaller construction companies who can’t afford cost delays, mistakes, or worse, a bad reputation. 

 

What has contributed to the labor shortage?

 

As incredulous as it might seem, there was a surplus of workers at the height of the housing bubble. However, during the 2006-2011 recession, construction companies shed about 2.3 million jobs. Fast-forward ten years, and with the housing market recovered, there are jobs but not enough employees to fill them. According to the Bureau of Labor Statistics, there are currently over 404,000 unfilled construction positions. 

 

What has led to the shortage: 

  • During the recession, skilled workers who were unable to find work joined new industries, many dropping out of the workforce entirely. 

  • Baby Boomers are aging and therefore retiring in record numbers.

  • The millennials entering the market have unrelated degrees, lack experience, training, and lack the incentive to join the construction industry. 

  • There is a waning interest in the construction industry as it continues to be a late adopter of technology that is attractive to the younger generations. Construction firms compete with other rising industries like healthcare, technology, and engineering. 

     

The construction industry’s landscape is rapidly changing, and the COVID-19 pandemic is not helping. Even with builder and consumer rising confidence and a recovering job market, it isn’t easy to find qualified workers for skilled construction positions. The demand for building activity will continue to grow, but without skilled workers, contractors must adapt and, in many cases, depend on technology. 

 

 

Adapting to the shortage of construction labor 

 

Rather than going into a full-on panic mood, the construction industry must step up to the plate, getting creative and savvy about how they address the labor shortage– this, of course, without sacrificing quality or profits. 

 

Register now for our latest webinar: 5 Ways to Increase Profits During 2021

 

In general, the construction industry must do a better job of reaching out to high schools and community colleges and appealing to young adults to join the industry, but this takes time. Of course, this solution will not help contractors currently struggling to get their projects done–but contractors should not be too quick to adopt only the short-term solutions. Longer-term solutions like increased training and shifting perceptions will have a drastic and beneficial impact on the industry as a whole, and everyone should be doing their part. 

 

Construction companies looking to fix the labor crisis more immediately should invest in cutting-edge technology, implement employee retention strategies, improve their hiring practices, and develop their existing workforce. 

 

Keep Equipment Simple

 

In many cases, choosing the right construction equipment can make a big difference, allowing skilled and unskilled labor to get more done through increased efficiency and productivity. Many construction companies are rediscovering machines such as the mini skid steer and using them as a natural solution for the labor shortage. 

 

When deciding which equipment is best for your job site, it is essential not to get overly excited by machines with a ton of bells and whistles. Equipment and machines should be easy for even unskilled laborers to use. Simple controls make a huge difference in lessening the pinch of the skilled labor shortage. Construction equipment equipped with plenty of bells and whistles might seem more exciting, but they can end up requiring more maintenance due to more components that can break; additionally, they may need more skilled labor to operate. 

 

Simple, intuitive displays make it much easier to address the challenge of attracting people who don’t want to be out shoveling materials but adept at using controls. Newer machines are easy to use and make construction easy, comfortable, and less reliant on manual labor. 

 

By purchasing construction equipment with simple to use controls, you can more heavily rely on unskilled labor to get work done– even clearing out debris with simple machinery can significantly increase job site efficiency. 

 

Not only will the right equipment convert unskilled laborers into more productive workers, but they can replace the need for additional workers. Often for less than the cost of adding more laborers. Our electric mini skid steer can replace several laborers; go to our cost calculator to find out how much you could be saving.

 

Changing Perceptions and Training the Gamers

 

To attract today’s youth to the construction industry, the perception of it must change. Construction is synonymous with manual labor, sweat, grim and injured backs– but with changing technologies, there is a reduction in the need for manual labor. A positive message for the construction industry is needed. The construction industry isn’t what it once was; for one, it is sager. There are plenty of higher-paying jobs that are not even reliant on manual labor. While it may take a while to change perceptions, it is possible to attract younger people to the industry. 

 

There are 404,000 unfilled construction positions.
-Bureau of Labor Statistics

 

What the construction industry needs are gamers with a mechanical aptitude and some training. Local association branches often offer training programs that could benefit young adults looking to get out in the workforce, are avid gamers, and are mechanically inclined, but may not wish to go to university.

 

Improve Hiring Practices

 
With a labor shortage and a limited pool of skilled laborers, you’ve got to compete. Construction companies must not only attract skilled laborers, but they must also retain them. Smaller construction companies can’t afford to compete on salary, so getting creative is the key to attracting skilled laborers. As a smaller company, it is essential to understand your target employee. What are they looking for in a job- money, flexible time off, benefits? If you can figure this out, you can reach out to the people who best fit your culture and your company offerings. Networking and looking for passive employees might prove to be a better strategy if your company is small and can’t compete against the more prominent companies.

 

 

Understanding what makes your company great to work for is essential; there might be a more considerable perk in that than in a large salary. Your company might be able to offer benefits that the more prominent companies simply cannot. Perhaps there is a more considerable emphasis on work-life balance, better one-on-one training, or better opportunities to be in a position of leadership sooner versus later. 

 

The hiring process is the best time to show a candidate how great your company is. If you are going to compete for top talent in a market that is lacking in options, you have to let potential hires see how great it is to work for you. 

 

There is no need to go into a panic mood at the thought of the labor shortage. Instead, it is time to adapt. Many contractors are concerned with the labor shortage when there are already solutions to help mitigate the issue. 

 

Register for our latest webinar: 5 Ways to Improve Profits in 2021

 

Join us for our latest webinar:

Subs and Show

Wednesday, July 21st, 2021

@ 11:00 am EDT