Addressing the Construction Labor Shortage

The construction industry is in the midst of a growing labor shortage. Just this month I’ve run across a half dozen local news reports of construction worker shortages across the country. Construction firms in Phoenix, AZ; Bradenton and Sarasota, FL; Long Island, NY and the Lowcountry of South Carolina, which includes Charleston, are having difficulties finding enough skilled workers to meet demand. These aren’t isolated events. Every month you’re bound to find new reports of areas feeling the pinch.

It’s not a new story either. Reports of a looming skilled worker shortage go back to when the construction industry was starting its recovery from the Great Recession. Places like Arizona, Florida and Texas were already starting to feel the crunch near the end of 2012. As the economic recovery progressed and construction activity increased, it became apparent that many of those workers were not coming back.

For the past few years, a number of corporations and industry associations involved in the construction industry have been calling for reforms and reauthorization of the Carl D. Perkins Career and Technical Education Improvement Act of 2006 aimed at increasing quality technical education to bolster the economy. Reauthorization of the Perkins Act is key in providing enough students with the skills needed to meet the needs of industries like construction and manufacturing.

In July, the House Education and Workforce Committee passed the Strengthening Career and Technical Education for the 21st Century Act (H.R. 5587) with a unanimous vote of 37-0. One of the key provisions includes partnering with industries to align career and technical education programs with in-demand jobs. Other components of the bill include incentivizing programs for attaining industry-recognized certifications and to incorporate work-based learning with dual enrollment in postsecondary education or training. All of these are of significant importance to a construction industry poised to add close to a million jobs over the next decade.

Another bill, the Critical Thinking, Collaboration, Communication, and Creativity for Careers Act, or the Four C’s for Careers Act (H.R. 5663), was also introduced last month. One of the sponsors of the bill, Rep. Ryan Costello (R-PA), had this to say, “This legislation involves the active participation and feedback of the industries that need workers, and we have customized it to help future employees gain the skills necessary to be career-ready. We are very excited about it.” The Senate Health, Education, Labor and Pensions Committee is also working on a Perkins reauthorization bill which hopefully will be introduced when they return from their summer recess next month.

The construction industry lost around 2.3 million jobs during the downturn. Between 2011 and the end of 2015, the construction industry has added back only 1.13 million of those jobs. Despite growing reports of skilled labor shortages, the construction industry as a whole was adding jobs at a healthy pace. In 2013, 211,000 jobs were added and the industry added 362,000 jobs in 2014 according to the Bureau of Labor Statistics (BLS). In 2015 another 296,000 jobs were added.

So far this year, the construction industry has only added 55,000 jobs, having shed jobs in April, May and June. Even in July when construction employment increased by 14,000 jobs nationwide, the Associated General Contractors (AGC) reported that it declined in 27 states and remained flat in Alaska for the month.

In a previous post, we discussed How Construction Companies Can Beat a Growing Labor Shortage. That article focused on how employers can set themselves apart for the increasing competition to attract the best workers as well as some programs geared toward attracting the younger generation to consider careers in construction. There’s no “magic bullet” to solving the labor shortage. It’s going to take a multitude of solutions and approaches working in concert with each other to create a pipeline of workers to meet the growing demands of construction for the next 10, 20 or 30 years.

8 thoughts on “Addressing the Construction Labor Shortage

  1. There needs to be a sense of career continuity in order to attract young men and women to the construction industry. the private sector is always willing to invest in new construction if there is a positive ROI. the public sector shoud take a hint from this and make the necessary investment in our failing infrastructure. the more we wait the more expensive it gets and the less we get for our investment. We as an industry need to put the pressure on our elected officials to restore Americas great roads, bridges, parks etc. before it is too late

    1. Thanks for the comment, Charles. Yes, career continuity and paths for advancement need to be promoted in order to attract young men and women to the industry. And yes, investment in infrastructure is crucial and overhauling the investment methods.

  2. While I appreciate your piece and the points that it made, it was missing what is a critical piece when it comes to addressing the shortages we see today. Our building trades which are covered by collective bargaining agreements not only offer better compensation and benefits, our Apprenticeship programs allow participants to earn as they learn. Our training is and always has been state of the art and the best in the business. We offer equal opportunities, advanced safety training and defined advancement in both wages and skill levels.

  3. Charles and Ron both missed it. Charles speaks of roads, bridges and parks, etc Ron speaks of Union labor. There are more private construction companies then there are Union shops.
    A major issue is our undocumented workers and the careless companies that employ them. If you get rid of the undocumented workers the industry would need to the fill the gap with younger generation people. If the construction markets itself as a great way to learn and earn we’ll have a better chance of quality tradesmen sticking around.
    An undocumented worker works in a car wash last week but this week he wears a tool belt. His employer (an idiot) thinks he a carpenter and pays him cheap. The undocumented worker lies to the employer so he can have work for a week. It’s like a virus in the Northeast.
    Uneducated employers who don’t have any business acumen or economic sense and has no idea about overhead or profit. They estimate incorrectly and the only way to build the job is to higher really cheap undocumented workers who lie and have no talent.
    If the illegals were able to infiltrate and get jobs in the banking, finance, medical, politics, law and other industries that aren’t manual labor we WOULDN”T have an issue of finding quality and talented tradesmen. If the illegal were able to get at those jobs I guarantee you a “wall” would have been built a long time ago!
    Hypothetically, If we didn’t have illegals, the construction industry wouldn’t shut down. It would be forced to pay higher wages and retain talented individuals because there would be less employee options. Supply and demand. Get rid of the illegals, half the problem solved.
    No one wants to enter the work force when it’s dominated by day laborer illegals pretending to be tradesman and who are driving the wages down.
    Young workers are going to different sectors.
    When the Irish and Italians came over they adopted the USA as their home land,
    The Mexicans/Asians are working here, sending their wages back to their homeland, building houses in their birth country and leaving the USA 25 yrs later. The money is not spent in the local economy or contributing to our infrastructure that they are overwhelming, using Medicare and not paying into, etc.
    We need to get rid of the illegals and market the construction industries as a respectable place to have a career and provide.
    We need to train business owners on how to operate a business correctly, all aspects!
    The industry is broken. Needs a over haul. Politicians, lawyers and insurance companies manipulate the industry. It should be industry business owners who dictate parameters.

  4. If the contractors did not use these undocumented under the table paying them cash as 1099 independent contractors cheating the government and workers out of money, forcing ethical business people to do the same thing to stay in business, it would not be going on. Some people need to go to jail, then maybe it would stop.

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