Ed Gruss is Aerotek’s director of divisional operations, leading the environmental and engineering division, which provides both the management and craft labor talent needed to support construction projects from concept to completion, including engineering, design, construction, restoration and disposal. Contact Gruss at firstname.lastname@example.org or 410-657-3228. Visit Aerotek.
For years, market forces have continued to drive up demand and tighten the construction labor pool. In 2018, these factors have the potential to become extreme, making it more difficult than ever for employers to find the workers they need to complete their projects. Meanwhile, workers who are less than satisfied in their current jobs are more vulnerable than ever to being poached by a competitor. Consequently, construction business owners must diligently tackle the challenge of hiring and retaining top construction employees.
According to industry experts, a number of positive trends are impacting construction growth. “Some are evolutions of past years, such as off-site construction and an increasing reliance on technology, and some trends are new, such as a focus on resiliency after the most damaging hurricane season on record and devastating fires in California,” notes Construction Dive. "This optimism is likely based on current economic conditions, an increasingly business-friendly regulatory environment and expectations the Trump administration will boost infrastructure investments," said Stephen Sandherr, Associated General Contractors of America chief executive officer (CEO).
Like a lot of employers, construction companies have been buoyed by the Tax Cut and Jobs Act, which freed up capital that can be put toward additional growth. Many of these factors have been in play for years. However, they could be gaining momentum rather than losing it.
Renewed Focus on Retention
A 2017 survey by the Associated General Contractors of America found that 70 percent of construction companies said they were having difficulty filling craft positions, with 67 percent also predicting that craft workers will be hard to recruit throughout 2018. In response, many report they are renewing their focus on retention efforts in the following ways:
|Increased base pay rates||60%||52%|
|Provided incentives and/or bonuses||36%||35%|
The competitive hiring landscape could lead your best employees to look around for better opportunities. This risk becomes even higher if they feel they are not being valued or paid what the market dictates.
Market-Rate Wages Are Key
Workers who are already employed can be motivated by increased wages. CareerBuilder’s 2017 Candidate Experience Study found that more than 75 percent of full-time workers either actively looking for or open to new opportunities cited pay as a reason for the search. The following findings revealed other factors as well:
- 50 percent want a higher salary
- 59 percent said a higher base salary would make them consider a new opportunity
- 13 percent of employees would leave their current job for a raise in pay
Invest Time in the Employee Experience
In times like these, maximizing the employee experience becomes even more important. It’s crucial to make sure your workers feel valued, listened to and respected, and that any issues they have are resolved in a reasonable amount of time.
Research over the last decade has made a convincing case that employee engagement in the workplace is highly correlated with success in achieving business goals. Gallup’s 2017 State of the American Workplace report found that companies with highly-engaged employees experience 17-percent higher productivity, 70-percent fewer employee safety incidents and 21-percent higher profitability, among many other positive metrics. An engaged workplace also helps create a positive work environment. When employees are engaged at work, they do or feel the following:
- Feel a connection with the company
- Believe that the work they're doing is important
- Want to work harder
Need to Increase Efforts
According to a 2017 FMI Talent Development Study, 61 percent of employers surveyed didn’t measure employee engagement. For construction companies, it can be difficult to allocate scarce budget dollars to programs that measure and promote employee engagement. It’s still a good idea to see if you can find a way to fund this kind of program, since relying on a workforce that is not engaged can lead to more material cost once waste is factored in.
Effectively managing overhead costs must be a priority for any successful project. Paying too little attention to overhead can reap unintended consequences on both labor and material cost if you’re not careful or haven’t identified an alternative way to manage your workforce. With the labor pool becoming more constricted every day, the most successful companies are focusing their efforts on retaining their top employees. They do this by making workers feel valued, but also by training them and developing them so they want to stay and become more productive as time goes on.
A Streamlined Approach
Not surprisingly, resource-starved construction businesses may find that they do not have the bandwidth to handle the multitude of tasks required for successfully recruiting and retaining labor. They should consider a “one-stop-shop” approach—a managed resources solution that covers everything from recruiting and hiring to onboarding and performance evaluation. Construction companies are experts in construction, and for some, it makes sense to outsource those responsibilities to recruitment partners who are equally expert in both finding and retaining the industry’s top talent.