Expert strategies for coping with construction labor shortages

Labor shortages affect every industry in the United States, but the construction industry has been facing additional challenges for decades, which have recently been exacerbated by the pandemic.

Misha Fisher, chief market economist for home services Engy, Some issues that create shortages. The first, is a significant shift in the starting age for new workers entering occupations.

“People are starting careers now mostly around 16 to 20 years old,” he said. “But now, workers are entering mostly 25 to 30 years old.”

This delay in entering the field means that employees have different expectations. They are post-college and looking for jobs that fulfill their education and also need salaries that reduce their accumulated college debt.

Some are noticing a different trend, such as more Millennials and Generation Zs getting into the trade who don’t want to go into college debt, as well as an underrepresentation of Generation X in trades. Ross Katherine, vice president of timber and building materials at building products distribution company Do It Best Corp, saw this void when it came to Generation 10. He believes Generation X experienced a recession in 2008, when they were laid off as the most inexperienced employees and never returned.

Fisher cites a variety of ways the construction industry will grow and change over the next year, which will affect the need for employment. For starters, there is an almost unimaginable amount of real estate equity that has been acquired in the past two years, coming in at $7.6 trillion, putting the outstanding equity at $27 trillion. So, standard home values ​​mean standard expenditure on home service.

“People typically spend about 2% of home ownership on improvement,” Fisher said, and he expects it to reach $475 billion this year. “This is largely focused on home improvement, not maintenance and emergency repairs. So, in terms of companies that are attracting labor to complete this work, they are going to be competing with multiple sectors and need to think about where they are pulling out of.”

In addition, the majority of national housing was built in the 1940s and 1950s, which also meant the failure of old systems and patterns. And with higher interest rates, more and more people are making their current residence suitable for their needs, so you can also consider making renovations to make up the family and aging in place.

On top of the real estate equity boom, mortgage interest rates are lower than inflation, so homes are still better than just looking at the sticker price will make it pop. While the demand for labor for building homes declines with interest rates, the home service economy is flat on an annual basis. The higher prices will also motivate people to stay indoors, which will benefit them in remodeling at the cost of moving. If interest rates continue to rise, a redesign would be a better deal.

Together, this means that competition for labor will be intense, so companies still need to get their hiring and retention strategies in order. When or if there is a retreat, there will be an opportunity for recruitment. These tips will help just on that occasion or being competitive during a tight job market.

Recruitment Strategies

First, Fisher says compensation has to become a science, because the construction industry doesn’t pay enough to be competitive with other industries.

“In general, the national story is that compensation in construction is not a science, but now it rivals the labor market that has come a long way in compensation and benefits,” he said. “The industry is conservative, but it does mean that the payment side needs innovation, so take a look at how the benefits are structured.”

Laura Conover is president of Conover Consulting, a compensation and leadership company, and notes that the entire employer-employee contract has been turned upside down since COVID.

“Employees as a group have more power than they did a few years ago, and that power is reflected in higher wages,” she said. “Paying on a competitive basis now means raising the minimum compensation while ensuring that those with longer tenure and/or higher performance are not paid less than those new to the organization. Pay increases should also be aware of pay equity issues and pay transparency, They are hot topics that many states have addressed through legislation. Besides raising the minimum hourly wage offered, employers also have to ensure they are competitive with the pay for all their jobs. Many employers have established mid-year increases in all areas from 4 to 5 % in 2022.”

But, as Branka Minnick, CEO of the Building Talent Foundation, suggested, compensation is only part of the puzzle. Her organization participated in 2021 Study of workforce involvement in home construction which revealed the need to prioritize employee engagement.

“The number one thing every business owner can do is keep the people you have,” Minnick said. “Before you hire and struggle to get hired, try to keep the people you have.”

According to the study, doing so requires participation at all levels, as well as appropriate compensation.

“The main reason people love their jobs isn’t compensation, it’s actually access to training,” she said. Also high on the list were their immediate supervisor and leadership skills in the ability to motivate and engage crew members. These are the non-monetary benefits or parts of the job that were so important to employee engagement and retention.”

Depending on what the report identifies, delivering career advancement and skills training within your organization requires dedication and commitment at every level. For example, supervisors need to understand the motivations and objectives of their reports and provide guidance. The path to progress should be clearly communicated, while employees should also be given specific time to develop skills.

eavesdropping on women

Fisher’s second strategy is to consider how to immerse himself in the untapped well of female talent.

“Women make up 50% of the general population, but only 2.4% of carpenters, 4% of construction workers, 2.4% of electricians, 1.8% of plumbers, and 3.7% of construction supervisors,” he explained. “Surveys and surveys show that women are happy with their jobs in the professions, but they are not being recruited.”

The Building Talent Foundation also commissioned a research project that resulted in Women’s guide to breaking down barriers To hire, train and retain women in residential construction occupations.

“If you look at the best employers who are recruiting disadvantaged groups, they are not going to do it alone,” Minnick said. “It’s all about partnering with organizations where you can attract that talent and help you reach a diverse group. You can’t just put an ad on the job board.”

Quick through report illustrates best practices for recruiting more females to reach out directly to women by meeting them wherever they are, communicating with them via images and language that reflect their identity, sharing information to build awareness, and measure progress.

“You can’t make things happen unless you have certain goals and you measure progress toward the goals,” she said. “You can say you want to have 25% female candidates, you can’t say you are going to hire a woman over a man every time. But you can commit to a number of candidates and then let the best candidate win the job. By the fact that you are measuring the diversity of the candidate, you will improve the results.”

Angela Gardner is the Director of Business Development and Marketing at Hill Electric and also as a co-founder of newly built womena social podcast site celebrating women’s non-traditional career journeys, and shares that a lot of hiring starts with getting involved at the local level.

It works hard in its marketplace to help educators and counselors understand the opportunities for women in this field, going so far as to create a series of certifications from the field, included in this Powerful videos.

“You need to reach out to your local job centers and get involved,” she says. “Our Women Talk Construction has given many presentations at the local Career Center and at Greenville Tech. We share stories, bring in many of our members, and give Q&A. Fear not. They crave it in career centers because it helps them recruit and retain sophomores.”

Her visits to professional centers highlight the interest in this field. Students want to know what kind of classes they should take, the importance of internships to get a job in the field, clothing, working conditions, and tools. Students are eager to hear stories from successful women about how they entered the industry and are shocked by the diversity of jobs and opportunities.

The other thing that Gardner is sure to highlight is helping them understand the benefits of being an owner, which must be introduced at a young age.

Gardner also advises putting in strong structures to support them once they are on the job.

“I feel like all women who get into a non-traditional role need to find their own clan of women who can bounce back from them,” she said. “The young women in our group reach out to an older member for guidance when they encounter challenges, and they do! From poor treatment in the workplace, not being paid equal, not the same access to advancement opportunities as male peers, or managers not accepting responsibility family”.

Recruitment Channels Update

Next, Fisher says recruitment channels need to be updated because word of mouth is still the most common source of recruitment. While word of mouth is an effective tool in terms of trust, it cannot be scaled up, so the industry needs solutions that can bring in the volume of workers needed.

His data shows that nearly half of the candidates come through word of mouth, while posts on Facebook and online job postings are about 35%; It is followed by craigslist posts and classifieds with about 25%; job fairs by 23%; and trade associations and trade vocational schools by 20%.

Minic approves and provides services to support businesses that need more complex operations.

“Ninety-two percent of employers in this sector are very small construction employers, so they don’t have very sophisticated multi-channel recruitment strategies,” she said. “Big employers can do it themselves, but a small business owner doesn’t have the resources for that, so we’re trying to bridge that gap.”

Focus on non-monetary things

Finally, Fisher says it is essential to highlight the non-monetary benefits of the job.

“People in the industry are often very satisfied with the meaning and value in the business,” he said. “This means developing a better understanding of how to improve wage rates, profit sharing or other forms of equity payments, retention and signing bonuses, and other benefits.”

In addition, cashless operations also have room for growth in terms of developing clearer career paths, increasing levels of ownership that follow a predictable path, highlighting satisfaction, meaning and value in the work involved, and creating more engaging cultures, just as the correlation study reported.

Future job prospects

Fisher does not hesitate to link the company’s hiring process to the success of its overall business.

“I think we will see leading companies continue to innovate in the above ways to attract and retain top-tier talent, and they will gain market share in the industry because they can really meet consumer demand with their larger workforce,” he said. “I also think we will continue to see new product innovation from manufacturers that improve installation speeds to save labor as well.”

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