The Construction Labor Shortage is a Work Culture Problem

Posted July 19th, 2021

The construction labor shortage was bad before the coronavirus pandemic; now it is a full-blown crisis. According to a CNN Business article, the construction industry lost 1 million workers during the initial months of lockdown. Now, the article states, the industry is losing workers faster than it can recruit new ones.

According to the 2020 Construction Outlook Survey, 81% of construction businesses have trouble filling positions, whether they are skilled tradesman roles or salaried office positions.

That labor shortage has a real impact on performance and profitability. According to the same survey, 40% of firms have experienced project delays, and 23% are being forced to extend completion times in bids because of staffing shortages.

There is also an impact on jobsite safety. Fewer workers means longer hours and more chances of workers performing tasks they are not experienced in. Fifty-seven percent of the construction companies surveyed listed inexperienced skilled labor or labor shortages in general as the biggest challenge to crew safety.

So, why are construction workers leaving the industry? And what can business owners do to recruit and retain quality workers?

Money isn’t the silver-bullet you think it is

According to the 2020 Construction Outlook Survey, 52% of construction businesses are looking to grow their business by 1-10 people, and almost 25% are looking to grow their team by more than 10 people. That’s a lot of open positions.

So, what makes your job offer stand out?

If your answer is Wages, think again. Fifty-four percent of companies have already increased salary rates. In fact, the national average wage for a construction worker is $32.86, much higher than the average wage in other industries like hospitality or retail.

Money matters, no doubt about it, but it is not the end-all be-all that many construction leaders assume it is. For example, workplace culture and the potential for advancement matter as much, if not more, to younger construction workers.

Besides, paying people competitively for hard work that often involves physical labor and mental toughness shouldn’t be an incentive. It should be a given.

Which brings us to the elephant in the room. Workplace culture.

Workplace culture matters more than you think

Workplace culture is driving many construction veterans to leave the industry.

Stop. Read that again.

That stereotype of the silent, tough-as-nails Joe who gets it done no matter what, who never talks about his pain or his feelings, who takes all the yelling and backstabbing without a peep …. Yeah, that guy is an illusion.

The truth is that construction workers are human, and nobody likes being treated disrespectfully. Most of us want to be able to admit we need help, or that we don’t know how to do something, without fear of bullying or punishment from management. All of us want to feel like our work matters, and all of us want to be able to spend time with the family we work to support.

Nobody wants to work in a toxic work environment, and now construction workers are starting to demand better. 

This is doubly problematic, as referrals from employees is one of the best ways to find your next rock star employee. Construction is all about relationships, and friendships run deep within the skilled trades. If you have hostile managers, unrealistic expectations, and no career development opportunities, your exiting crew members will tell their friends.

Younger generations list workplace culture, community, and growth potential along with salary as the most important qualities in a new role. To recruit new blood into the industry, construction businesses should focus on culture, continuing education, and career advancement.  Your culture and your sense of team matter the most to people.  If you don’t have that or know exactly what that is then start right there educating yourself, your leadership team and then make the changes.

Invest early in new, diverse talent

According to the Bureau of Labor Statistics, just 6% of construction workers are Black or African American. About 10% of the labor force is women. That’s a glaring diversity problem. It’s also a labor problem. 

Few minorities enter the construction workforce because they aren’t familiar with it, according to the Associated General Contractors of America. Introducing underrepresented groups to the opportunities in construction, through vocational school programs, technical colleges, and other community outreach, can help solve your labor problem and impact the industry’s overall diversity issue.

Investing in diversity is also investing in innovation and productivity. Companies with diverse management teams have 19% higher revenue due to innovation. Basically, if you need new solutions to problems, you need to introduce new perspectives.

Diversity without inclusion, however, is meaningless. Culture is also part of construction’s diversity challenge. Construction Dive recently published a six-part series on racism in the construction industry. Over 40% of respondents to Construction Dive’s related survey said they had seen racist graffiti, and 38% reported hearing verbal abuse or ethnic slurs.

Another challenge to recruiting in construction is the decline of shop classes in the public education system. These classes are often a gateway for students into the world of construction. Shop classes gave students who didn’t want to pursue a college degree a peek into the world of specialized trades in construction.

The good news is shop classes, after a sharp drop a few years ago, are starting to come back. An increase in interest in the industry has also led to multitudes of technical colleges offering certifications and local trade organizations offer apprenticeships and training.

Here’s your competitive advantage in the talent battle — get involved and stay involved.

Reach out to your local technical college and get involved in their construction programs. Volunteer to be an expert guest, or let a class visit your shop and answer questions there. Work with your trade organization to offer apprenticeships. Bringing people in as apprentices gives you a chance to show them your culture, and gives them a chance to see themselves as part of your team. Donate materials to the local high school shop class. Volunteer time to speak to the kids, or bring them to shop.

Invest in people early in their career and they will never forget you and the help you offered. Even if they don’t join your organization, or eventually leave after years of loyal service, they’ll always speak highly of you.

Labor shortages are complex problems with multiple, intersecting causes. Will building a work culture of respect, dignity, and trust at your business solve all of them? No, but having a positive, supportive work culture will help you attract new recruits and keep the rock star talent you already have.

It will also create a place where everyone, including You, enjoys coming to work.

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