Contractors, are you having any luck finding skilled tradespeople for your projects so you can grow your company? It can be tough. It’s been that way for more than 10 years, when a lot of workers left construction during the Great Recession never to return.
Compounding that loss is the fact that 40% of today’s skilled tradespeople are set to retire by 2031 and young people haven’t been coming into the trades in great numbers since the 70s. Right now, only 5% of high school parents expect their children to go into the skilled trades.
The shortage of workers in construction has also contributed to a record backlog of homes authorized but not started. You’ve probably had to push back projects yourself.
So what can you do? In this post, we will look at some steps contractors can take that could lead to an increase of skilled tradespeople in the not too distant future. We’ll split these “fixes” into immediate, medium-term and long-term fixes.
Immediate fixes to the skilled tradesperson shortage
Post ads for open jobs
Yes, there are fewer skilled tradespeople than there were 20 years ago, but they are out there. Somewhere. The key is to find them and a very common way to find them is through job ads on sites such as Indeed.com.
There’s a right way and a wrong way to post a job ad:
- Make sure you use commonly recognized job titles that will show up in Google searches. That way, you’ll get found.
- Include enough detail about the job without making it too long. A few bullet points should do it.
- Include a few key upsides of the job to make it attractive to applicants.
- Include the pay rate if at all possible.
- Also, make sure that your job ad uses inclusive language so your ad will resonate with female skilled tradespersons. For example, avoid verbiage like this: “Equipment installation and set up takes around 16 man-hours to complete.”
Start an employee referral program
Referral programs reward your employees for referring a talented candidate who ultimately gets hired and stays with the company for a predetermined period of time. Referral bonuses typically range from $1,000 and $5,000.
In essence, your employees become “brand ambassadors” for your construction company—telling their friends what a great place to work it is. If you start an employee referral program and get no referrals, it could be a sign that your employees are dissatisfied with your company. (That will be a blog post for another day!)
Make the process simple for your employees. Use an online employee referral tool with a simple online form. Also, you can go “old school” and put a dropbox in the site trailers where people can drop in friends’ names.
Offer a hiring bonus
Hiring bonuses were a perk that used to be reserved for management, but more and more construction companies are offering signing bonuses to skilled tradespeople. According to the Associated General Contractors of America, close to one-quarter of contractors reported using bonuses to attract employees, ranging between a few hundred dollars to over $1,500 per worker.
Some contractors fear the possibility of a bidding war. They’re concerned contractors doing large projects, like the $10 billion Foxconn factory in Wisconsin, will be able to offer larger signing bonuses to lure workers away.
Find a temporary staffing provider
The idea behind temporary staffing, or contingent labor, as it’s also called, is the contractor shifts costs from fixed to variable. When your production levels increase, you bring on more temporary labor and then simply reduce your contingent staff load when things slow down.
Some contractors think that since temp agencies all gather workers from the same pool on unemployed people, their service is a commodity. Not so. Make sure your staffing agency checks these boxes:
- You want a staffing provider that is specialized in your type of work.
- You want a staffing provider staffed with local people with connections to the industry locally—staffed out of a local branch. You don’t want to have to deal with people from “headquarters.”
- You want a temporary agency that walks the talk when it comes to safety.
- You want a staffing agency that handles extra costs such as employee benefits and FICA, FUTA, and SUTA, not to mention workers’ comp.
But what if the skilled tradespeople just aren’t out there in sufficient numbers? What do you do then? Is there a way to “grow your own”?
Yes. That brings us to . . .
Medium-term fixes to the skilled tradesperson shortage
Get your best general laborers into an apprentice program
It takes about four years to create a journeyman tradesperson through a learn-as-you-earn apprentice program. So what are you waiting for? The sooner you start, the sooner you’ll solve your skilled tradesperson shortage.
An apprenticeship is an arrangement where you get hands-on training under the supervision of journey-level craftsperson, classroom instruction and a paycheck that steadily grows as your skills grow.
The best way to start is to cherry-pick your best general laborers and get them started on apprenticeships. See: How a general labor job can get you into the construction industry.
If you’re using a staffing firm for your general laborer needs, make sure the agency understands you want general laborers with an interest in a career in the trades. The best staffing providers take the time to understand their workers’ hopes and goals.
Long-term fix to the skilled tradesperson shortage
Much of the skill tradesperson shortage is due to the fact that the industry has a negative image among high school kids and women.
School kids are encouraged to pursue a college degree rather than a construction career. School guidance counselors have cast the trades as an inferior career choice to college.
Meanwhile, women can see construction as unwelcoming. Construction is, still, mainly a white male world. Almost all the women in construction are in clerical roles. Electricians and plumbers are 98% male.
The construction industry needs to rebrand itself, and much of that work is underway by industry groups such as ABC and AGC. For example, in 2018, Lowe’s Home Improvement launched Generation T, a “digital-first movement” to educate communities on the skilled trades gap and raise awareness for good careers that are going unfilled. Since that time, the movement has reached over 10 million people across the United States online. In 2019, Generation T was awarded an American Advertising Award as one of the country’s best social media programs.
“The goal of Generation T is to inspire an entire generation to explore skilled trade careers,” said Michael Mitchell, Lowe’s Trade Skills Director. “By educating students and parents about these fields, and connecting companies and mentors to interested candidates, we can start to fill the skilled trades job pipeline.”
Are there any steps a contractor can take to improve construction’s image in the eyes of schoolkids?
One large construction company who is reaching out to young people is Barton Malow based in Southfield, Mich. They have created the Barton Malow Boot Camp. It’s a six-week paid work experience program that provides an opportunity for area residents between the ages of 18-24 to learn industry fundamentals.
Every boot camper is assigned a Barton Malow mentor, a skilled tradesperson on the project site, who spends two days per week during the program providing career guidance and hands-on demonstrations to the participants.
But what about small and medium-size contractors? What can they do to change kids’ view of construction and help themselves grow?
At Hamilton Heights High School just outside of Indianapolis, construction and engineering teacher Eric Fisher oversees a program that sends out kids in their senior year to local contractors in paid pre-apprenticeship model.
“I sent the first kid to a virtual design lab. The first Friday he got paid, all the other kids saw it and started clamoring to get involved. It took off.”
Eric’s advice to contractors who want to get involved in their local schools?
“Don’t go to the guidance counselors. Nowadays, the guidance department is in charge of testing, mental health, dealing with overbearing parents who want to get their kids into an Ivy League school. Instead, find the name of the construction teachers in your community and go to them. That’s how it will start growing.”
In terms of women, the Building Talent Foundation recently released a study, Women Breaking Barriers, A Guide to Recruiting, Training and Retaining Women in the Residential Construction Trades. Based on insights in the study, The Building Talent Foundation released The Small Contractor Quick-Start Guide to New Talent.
“No single employer can tackle these challenges on their own,” the foundation said in the guide. “Partner and build relationships with other organizations to reach untapped talent.”
In sum, the guide calls contractors to begin forming and nurturing relationships with women interested in the skilled trades and organizations helping such women. For example:
- Contractors could join forces with “collective impact organizations” that build workforce programs. An example of a “collective impact organization” is Wisconsin Regional Training Partnership, which works to help traditionally underrepresented and underemployed people like women and people of color get into the skilled trades.
- Contractors could build relationships with prospective female skilled tradespeople by speaking at career events, mentoring, hosting mock interviews and job-site visits.
- Contractors could build relationships with established community organizations and social service programs that offer “wrap-around supports” such as childcare, transportation and counseling.
Meanwhile, contractors could “build inclusion” by doing a better job of making sure women understand they are welcome in the trades. Some things they could do:
- Make sure your websites and employee materials feature inclusive language and diverse imagery.
- Create a formal inclusion statement for your organization and feature it prominently on your website and materials.
- Start thinking about safety differently, creating a “Total Safety Culture” that also focuses on psychological safety. This will help keep women safe from intimidation and violence.
- Conduct training programs for all employees on treating one another with respect. The guide points contractors toward several training firms that provide training “to businesses of all sizes and budgets.”
The report’s authors encourage contractors to create a baseline on how well they are reaching diverse talent, perhaps including an employee survey. Then the contractor could track its progress against that baseline.
“Be willing to try new methods,” the study’s authors say. “Learn from your mistakes and train again. Be sure to share learnings with partners.”
Wrapping up
You can find skilled tradespeople—or “grow your own—to help you grow your construction business. Start small—jobs ads and an employee referral program, for example. Slowly, start doing your part to change the image of construction among high schoolers and women by getting involved with programs in your community.
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