The persistent labor shortage has evolved over several decades, influenced by a range of factors. These include an aging population, the rise of the gig economy, and a shortage of training in the construction industry.
Specifically, the Baby Boomer generation, now reaching the age of 65 at a rate of 10,000 individuals per day, has led to approximately 20 million retirements since 2011. In 2020 alone, there were 3.2 million retirements. Unfortunately, many companies failed to adequately plan for their replacements, resulting in challenges when it comes to replenishing the workforce.
Additionally, the emergence of the gig economy has further strained the available workforce. Millennials and Gen Z individuals find appeal in piecing together multiple jobs or gigs to create a single income stream. As a result, alternative options such as ride-sharing or freelance services have diverted potential workers who might otherwise have pursued careers in construction, manufacturing, or transportation.
Lack of Construction Training
Insufficient training for construction jobs has emerged as a significant obstacle. While there are 11.5 million available jobs across the economy, the majority of these positions necessitate specialized training and education. Unfortunately, there is a dearth of trade schools and community colleges to provide this essential training. Moreover, only a minority of high schools offer programs related to industrial or construction training, resulting in a scarcity of skilled workers entering these sectors.
Investing in training and education programs, fostering a culture of continuous learning, and actively seeking out qualified instructors are crucial steps for employers. By prioritizing the growth and development of their workforce, companies can help bridge the gap and ensure a sustainable pipeline of skilled workers for the construction industry.
Solutions
While government-based plans and decisions play a crucial role in addressing workforce challenges, individual companies can also significantly impact employee retention. Let’s explore some strategies:
1. Retention Strategies:
- Competitive Compensation: Offering a wage that reflects the value of employees’ time and work is essential. Fair pay, adjusted for inflation, ensures employees can afford their cost of living.
- Work-Life Balance: Encouraging a healthy balance between work and personal life contributes to job satisfaction.
- Recognition and Rewards: Acknowledging employees’ efforts and rewarding their work fosters loyalty.
- Positive Workplace Culture: A respectful and trusting environment, where supervisors are fair and trustworthy, plays a pivotal role.
- Career Development: Providing growth opportunities and professional development keeps employees engaged.
- Cultural Fit: Hiring individuals who align with the company’s values and mission enhances retention.
- Effective Leadership: Leaders who inspire confidence and reward hard work contribute to employee satisfaction.
Remember, retaining talent requires a multifaceted approach. Explore additional retention strategies from resources like the Harvard Business Review for further insights.
2. Recruiting. We’ve all endured countless management seminars that present seemingly straightforward, one-size-fits-all methods for managing people. However, reality is far more nuanced. People cannot be effectively managed using a cookie-cutter approach. The true essence of effective management lies in selecting the right individuals. Among the critical factors to consider is whether a recruit aligns with the team’s dynamics and overall vision.
3. Adaptability is a critical factor in today’s workforce. As the landscape evolves, employees must continually embrace change. This involves not only grasping new machinery but also understanding novel communication methods and innovative ways of working and processing information. Companies must prioritize ongoing training to equip their workforce with the necessary skills as technology and processes evolve.
While major education and governmental initiatives play a pivotal role, businesses cannot afford to wait for these efforts to yield results. Instead, they must act promptly to navigate labor issues. Fortunately, there are tactics and strategies that can empower companies to adapt and even thrive in these conditions.
At MarksNelson, our construction team intimately understands the industry’s challenges. Whether assisting construction firms in adopting and implementing new technology or providing financial expertise, we are committed to helping your company forge a better future.
