The construction industry has officially found its way back on track, after years of a long recovery process following the recession. Construction was an industry that plummeted during the recession, as the housing bubble created a shortage in new home construction, difficult economic times stalled commercial construction and government workers were laid off. However, as all construction sectors found their way back to the top, a new crisis emerged as a labor shortage.
Last year, 25% of construction companies had to turn down work because of a shortage in labor, as reported by the Associated General Contractors of America.
Building material manufacturers are doing their part by increasing capacity to produce the materials needed to keep up with the demand for new construction and remodeling. But contractors and builders have still struggled to fill jobs.
With construction now moving steadily, the labor shortage is starting to disappear. This partially comes from other industries as they are laying off people.
Will the Ending Labor Shortage in Construction Last?
Brian Turmail, senior executive director of public affairs for the AGC believes it may be just be short-term.
“Clearly, during the last two months,” Turmail said, “the data tells us that firms have all of a sudden had a much easier time finding workers to hire, which prompts the question of where are they finding them.”
He believes workers are leaving other industries and returning to construction. Layoffs from oil workers and similar industries that are being phased out are leading many back into construction as they realize that some of these jobs in the softening energy sectors are not going to be returning.
Some construction companies are offering incentives such as better compensation levels to encourage more workers to consider construction. Brian believes this may be drawing more back into the industry as well. When there are jobs available, companies adapt and find ways to be more aggressive in their recruitment approach.
Regardless of the recent success in employment within the construction industry, many believe that the industry will still struggle to find skilled workers now and in the future.
David Chapin the president of Willmar Electric Service and 2016 ABC chair stated, “When you talk to most ABC members and other people in the part of the country that I’m from, you get the same stories — ‘We would sell more work if we could find more people.'”
Many builders tell me the same thing, “I could sell more homes if I could find the labor.”
The Big Issue
Most agree the issue is the aging workforce in construction. Most of the workers filling these jobs were laid off from other industries or are finding their way back into construction. Very few of these positions are being filled by skilled students that trained at technical schools or through apprenticeship programs.
An NAHB Eye on Housing report found that the average age of construction workers is a staggering 42. Of course, the average age of the overall workforce is 41, but construction is an industry where one would believe younger workers would excel. While aged workers may have more knowledge, it is a major concern that these workers will be difficult to replace come their retirement.
Construction was an industry that many saw as a difficult path to travel following the recession. It was seen as a career of uncertainty. However, many are saying that the construction of buildings is a guaranteed job, something that is not disappearing or going to be subject to another recession. If students are listening, that could mean the labor shortage in construction is ending. With good pay and a career of longevity, it has enormous potential.
The AGC has developed a workforce development plan that emphasizes getting more students involved with technical and career training programs specifically targeted toward the construction industry.
Building material manufacturers can help fuel the recovery of the labor shortage by encouraging more people to look for jobs in construction. They can also help by supplying educational and installation instructional materials to make it easier to bring new people into the construction labor pool.
Here’s more about the labor shortage and what contractors can do to fix it.