Overcoming the Challenges of Finding and Developing Talent in the Construction Industry

October 2018

 

by Sarah Mueller and Jesus Yactavo, Shapiro & Duncan

It’s a theme that has become all too familiar in construction companies these days. You have the work. You have open positions. People are applying. But you can’t find the talent with the technical skills you need.

Let’s assume that your company is a mechanical contracting firm that provides cutting-edge mechanical solutions including pre-construction, engineering, construction, design/build, fabrication, installation and maintenance services. This company would have an ever-growing need for senior HVAC techs and journeyman plumbers, pipefitters and welders. These positions require three to five years of experience. To find the right people, and then develop this talent after they come aboard, it takes a multifaceted approach.

Causes of the Construction Talent Shortage

With the current unemployment rate at 3.9 percent, the lowest since 2000, virtually everyone who wants to work has a job. This is what economists call a “full employment” economy. This workforce reality is certainly reflected in today’s construction industry. Everyone who is in the skilled trades and is good at what they do is already employed. Nevertheless, the work is out there and contractors are forced to compete for a shrunken pool of qualified talent. While there are plenty of entry-level people in the construction trades job market, a skills gap exists.

No doubt, construction is not easy work and that makes it even more challenging to bring people on board. Currently, there are half a million positions that can’t be filled in the construction industry because of the talent shortage. At the same time, increasing numbers of people, especially workers in their 50s and 60s, are retiring from the industry. As a result, the construction jobs deficit is expected to increase to 2 million by 2022.

Construction companies have to work especially hard to demonstrate to millennials that they offer a great career opportunity and a better place to work. Generally speaking, people born since the early 1980s are expecting advancement opportunities and work/life balance. Millennials are also concerned about career mobility; they don’t want to be stuck in the same position for the next 10 years.

Keys to an Effective Construction Recruitment Process

Recruitment must-haves for a construction company include all of the following:

  • In today’s digital world, posting a “Help Wanted” ad in a print newspaper has become obsolete. Instead, creating a strong online presence has become a critical channel to utilize in the recruitment advertising mix. Today’s recruitment advertising channels of choice include Indeed, Monster and even Craig’s List. Job openings should also be posted on a company’s social media channels. In addition, employee searches can be conducted through the LinkedIn Recruiter feature.
  • A robust applicant tracking system.
  • Encouragement of employee referrals. For example, an employee who refers a qualified new hire would be eligible for a referral bonus of $250 for an entry-level employee up to $5,000 for the foreman level. For an employee to earn the entry-level bonus, the new hire he or she refers would have to stay for at least 90 days. Larger bonuses would be paid over a one-year period.
  • Active participation in career fairs conducted by high schools, community colleges and four-year colleges.
  • Emphasis on safety. Nowadays, to attract enough high-quality applicants, construction companies must make safety a No. 1 priority. Maintaining a highly robust safety culture means providing safety training on an ongoing and as-needed basis. This emphasis on safety should be strongly promoted in the company’s recruitment advertising and supporting materials.

Diversity Matters

There is no doubt that a diverse workplace fosters a company culture in which different ideas and ways of looking at solutions can flourish. In fact, industry studies have shown that diversity in construction is linked to higher productivity. That is why construction firms should make a concerted effort to increase the number and importance of women in the company—including opening up opportunities for women employees to become members of the corporate leadership team—as well as hire and promote more Latinos and Hispanics.

The key to developing a diverse employee population is making connections that build on similar values. Construction companies must build strong partnerships with organizations that support hiring of Latinos and Hispanics, women and people with disabilities in construction. Examples in the Mid-Atlantic region include:

  • Worksource Montgomery, an organization promoting job training and placement in Montgomery County, Md., in the Washington, D. C. metro area;
  • International Rescue Committee, a Baltimore-based nonprofit that assists refugees from Latin American countries;
  • Associated Builders & Contractors Women Building Washington committee;
  • WV Women Work, an organization that promotes hiring of women from West Virginia in construction; and
  • Seeking Employment Equality & Community, a Silver Spring, Md.-based nonprofit that creates employment opportunities for people with intellectual and developmental disabilities.

Building strong relationships with organizations such as these requires communication on a regular basis, to make sure the partnership is a good match for your company’s culture.

Keys to Employee Retention

In today’s construction industry, as mentioned earlier, it’s hard enough to find high-quality employees. Once that talent is on board, it is critically important to hold on to these employees.

That is why employee education and training is such a critically important component of a committed and consistent recruitment process that aims to develop a skilled workforce. Moreover, employee development should be viewed as a strategic priority in the broader effort to develop a strong employment brand. Companies should invest in their employees just as they would invest in the corporate brand.

Today, employee development in the construction industry has become all about keeping employee skills current in a business environment where technology is rapidly advancing. This is not your grandfather’s, or even your father’s, construction industry. No doubt, construction is not easy work and that makes it even more challenging to bring people on board.

Meanwhile, the rising cost of education is another key factor related to employee recruitment and development in construction firms. A major challenge is heightening awareness among prospective and current employees that it is possible for a young person to work hard, earn a living with good benefits and obtain an education that will be of value to them—without being saddled with five or six figures of student loan debt.

Apprenticeships, in fact, are like obtaining a four-year degree without the cost. The tradeoff is working full-time while going to school either a couple of evenings a week or one to two days a month, depending upon the program and employer. For many, this is an appealing blend of classroom instruction and on-the-job training.

Prospective and current employees also need to know that they can have mobility within the construction field—that it’s not a dead-end career. In reality, there is always opportunity to evolve your job title and there is substantial room for growth in the field, no matter where the employee starts.

For example, with the right blend of education and training, a plumber could become a project manager or an HVAC technician could become an estimator. An apprentice could become a foreman, then an assistant project manager, then a project manager. From there, the career path could lead to project executive and ultimately to vice president. It all depends on the individual’s talent and drive.

Thus, providing education and training results in more upward mobility for employees, which in turn opens up more jobs, builds the company and ultimately adds value. Companies that place a high value on employee training and education could even go a step further and provide a tuition reimbursement benefit toward a degree at the local community college, a nearby four-year university or another institution of the employee’s choice. Two credits per year is a good starting point for a tuition reimbursement benefit.

Lastly, construction companies should strongly consider reimbursing employees for the cost of obtaining professional certifications. Whether it involves a skilled trade in which the employee is working on a journeyman’s, journeywoman’s or master’s license, or a skill area in which the employee wants or needs a professional certification—such as Design/Build, Leadership in Energy and Environmental Design or Human Resources—certification attests to their ability to handle a certain level of work. Employee certifications also demonstrate the company’s collective ability to perform. It shows that a contractor or subcontractor has the capability to drive the business, to drive projects and to be successful as a team.

Key Takeaways

To maximize the efficiency and effectiveness of a construction company’s recruitment and employee development/retention program, here are five things to keep in mind (in ascending order of importance):

  1. Work hand-in-hand to develop strong partnerships with employment resource organizations.
  2. Maintain an active recruitment advertising presence on Facebook, LinkedIn and other key online employment platforms such as Monster and state job boards.
  3. The company’s HR team needs to keep a running tally of jobs that are currently in place and pre-plan what future job needs are going to be—three months, six months, one year and five years out.
  4. HR should be actively engaged in the market, know how the economy is doing, and know what your competitors are up to.
  5. Make recruitment and employee development a strategic function within the company and allow HR to have a seat at the top leadership table with ownership.

Sarah Mueller is director of Human Resources and Jesus Yactavo is the senior Human Resources generalist at Shapiro & Duncan, Inc., a third-generation family-owned mechanical contracting business serving customers in the Washington, D.C., area since 1976. Shapiro & Duncan is the “Provider of Choice” for complex commercial, government and institutional design-build projects that require first-rate performance, work quality and customer service.

 

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