Workforce development has been an issue for two decades and counting, and a new AGC of America survey reflects the continuing struggle and, along with industry pros like the ones assembled here, offers insight into what members can and are doing to combat it.
BY A.D. THOMPSON
Workforce issues. As far back as the mid-aughts, it’s been at or near the top of the list of construction industry concerns. Project delays. Scale-backs. Postponements. Cancellations. Insufficient labor has impacted all of these things according to a recent survey conducted by AGC of America and the human resources experts at Arcoro.
Ninety-four percent of construction firms nationwide have open craft positions they’re actively trying to fill, with 82% noting a need for salaried employees, as well. Sixty-two percent report that available candidates lack the skills required for the jobs. Forty-three percent say applicants don’t even have the proper documentation, such as driver’s licenses or clean background checks. And perhaps most disappointing, half of firms report that after all the expense and time committed to the process, new hires quit soon after starting. Some fail to show up at all.
“What this year’s survey makes clear is that our nation’s failure to invest in construction workforce education and training programs is having a real, measurable impact on the country’s ability to build infrastructure and other construction projects,” noted AGC Chief Executive Officer Jeff Shoaf at a recent virtual media event.
Also on hand for the talk, a collection of industry professionals including pros in the economic and human resource spaces, as well as member firm reps, who shared their struggles and offered notes on what their companies have been doing to shore up their ranks.
Project-specific Training Fills in Gaps
Potential solutions, in many cases, are expensive, says AGC’s Chief Economist Ken Simonson, who noted that 61% of respondents raised base pay for hourly craft workers. Others spent money on training and professional development. Tech solutions, too — from employee education to on-site robotics — figured into the mix.
Although reps from some of the firms polled remained discouraged, skeptical of whether things would improve much in the short term, among the mix of firms at the virtual event, there was positivity to balance out the challenges presented. From Missouri to Michigan to California, experiences lined up neatly with survey results, many reported, including Latoya Goree Smith, principal, Rhys Ivy Construction, a minority woman-owned, construction and specialty program consulting firm specializing in workforce development and small-business engagement.
“We’ve definitely felt that lack of investment in education in Kansas City,” she said. “It’s been downhill for quite some time because the majority of the politicians have been focused on everyone going to college.”
To support the labor shortage, she said, local developers and general contractors — and even client-owners — have seen success doing project-specific workforce training. “Some are offering three-to-five weeks of paid training,” Goree Smith said of the former, who encourage subcontractors to hire these individuals upon completion of programs that include certification and basic skills training, even mathematics and financial literacy. It’s a holistic approach that does more than boost trade numbers; it lifts people up.
Owner-clients interested in fast-tracking projects in labor-scarce cities are getting on board, too, she said, identifying the trades that need bolstering and creating and sponsoring their own programs, “requiring the general contractors they hire to offer the training and recruiting talent into the labor trades, as well.”
Train and Retain
In Ludington, Michigan, Jami Klomp, human resources manager for Hardman Construction, an AGC of Michigan member, is seeing plenty of candidates interested in working, “however they just don’t have the skills that we can utilize.”
Hardman is a specialty contractor. Foundation, geotechnical, and bridge construction is their sliver of the industry, and they perform 95% of the work they are awarded. “People aren’t familiar with what we’re doing,” said Klomp, “even if they’ve been in the industry for 25 years.”
As such, there’s an extra layer of difficulty finding suitable candidates, and six or seven years ago, they noticed that things were starting to dry up. “We knew it would continue to be an issue and so we threw everything at the wall to see what would stick.”
Retention, she said, became the focus. “We began a huge effort with every single person in the organization and created a mentorship and training program…. We will train you; we will give you all the support you need and get you where you need to be.” New hires spend a week in a controlled environment at the home office and get safety training simultaneously, during which time, said Klomp, they see how many people — at the office, and in the field — care about them. “And with all those people caring about them, they know they have a home. A place we hope they’ll call home forever,” she said. “It’s been huge for us.”
Vetting Vets, Challenging Specs
San Diego is a military town, and Gita Murthy, president San Diego Chapter, is also the CEO of RORE, which is primarily a federal contractor: Army, Navy, Air Force. “Our chapter has the state’s largest open-shop apprenticeship program, the fourth largest education and safety training programs across the chapters. We offer training, we have outreach to the high schoolers, community colleges, and San Diego State University to entice students into the construction industry….”
It’s challenging all over but, said Murthy, federal contracting has some extra challenges in the stringent requirements for staffing amid a pool that’s already very shallow. “The Feds have these stringent specs that they expect us to meet,” she said, citing for example that quality control professionals are required to have bachelor’s degrees in construction-related disciplines such as engineering or architecture. “It’s nearly impossible,” she said.
They’ve had some success reaching out to the veteran population, working with the San Diego Military Advisory Commission with transitioning vets. “We’re trying to get them into construction,” she noted, “but our other challenge is that San Diego is an expensive city to live in. California is a very expensive state, and so it’s hard for us to keep the labor pool here.” It requires high salaries. “Trying to meet those while trying to win bids with low-price requirements? It’s just crazy.”
Murthy hopes they can make politicians understand the challenges. “It would be a huge step in the right direction; I think we need to go beyond our group and expand the discussion.”
Starting Young
Zach Fields and his team at Construction Ready are working hard to find the future of the industry today, spanning the education and industry spaces simultaneously. The nonprofit, founded over three decades ago in a partnership with AGC Georgia, pairs community-based training with a foundational approach in the K-12 space. “We echo the call to the federal government for more funding in construction education,” said Fields — whom you’ll meet in a companion piece in this issue — “but we also look at what’s already there. We want to maximize the dollars and the programs in place and make those work better.”
In addition to traditional solutions, “firms are using new tactics, including online apps and social media strategies, to attract younger workers.” said Carrie Gardenhire, director of association partnerships for Arcoro. Only about 20% of contractors, she said, say they’ve implemented software like Arcoro’s to automate the job distribution and hiring process. “There’s a significant opportunity for them to leverage tech to help with workforce issues.” And not just in the administrative space. Robotics and other on-site tech are helping on the job sites.
The takeaway?
Industry pros, on many fronts, can and are making a difference, with innovation and education, in the quest for growing the ranks.