The 2020 Construction Hiring and Business Outlook report by the Associated General Contractors of America revealed that 81 percent of construction businesses are having a hard time finding qualified skilled labor to fill open positions. What began as a labor shortage in small, isolated pockets as home construction bottomed out in 2011, is now exacerbated by a global pandemic and the effects it has had on safety protocols, employee health and supply chains.
Skilled labor was facing dire shortage issues before the pandemic, and the nation continues to feel the repercussions. In reality, the building industry overall has experienced positive growth in recent years, and confidence in multifamily construction grew in recent months, according to the National Accreditation of Home Builders (NAHB). This growth could be even faster if there were enough qualified candidates to fill open skilled labor positions.
Did All the Skilled Labor Just Disappear?
Due to the global pandemic, the construction industry lost 975,000 jobs in April 2020 as a result of lower demand, according to analysts at Statista. That is 13 percent of the country’s construction workforce. In the six months following, construction jobs recovered approximately 61 percent of the positions lost during the height of the pandemic. Experts predict that a vaccine and meaningful infrastructure package could help the construction industry recover some of the anticipated postponements and vacancies incurred during the coming winter months.
The problem remains that the industry was dealing with a skilled labor shortage, fueled in part by fallout out from the Great Recession in 2009, before the pandemic presented new challenges. Now, workload continues to ramp back up across the country, and contractors continue to come up short. The unemployment rate is gradually recovering, and many people are still looking for work—so why is it so difficult to find qualified, skilled workers?
Many skilled craftsmen have dropped out of the industry and don’t plan to return. Compounding this problem, a whole generation of younger workers are no longer even considering construction as a viable career option. Many high schools have phased out shop classes, and parents increasingly have steered graduates to four-year colleges and white-collar careers. Now, as older workers are retiring, there simply isn’t anyone ready to take their spots.
What’s Next for the Skilled Labor Shortage?
Good or bad, we have likely only seen the beginning of the construction labor shortage. Building activity is projected to strengthen over the next few years, and the demand for skilled craftsmen is expected to continue to grow. While residential and commercial construction activity may have increased significantly in recent years, many still view this resurgence as fragile—especially now, as the country heals from pandemic shutdowns and resumes normal life.
Constrained by a shortage of skilled workers, this resurgence could end up tempered by the continued increase of new home prices and delays in projects. Filling this gap is going to take a concerted effort on all fronts, including encouraging America’s youth to return to the construction industry. The skilled labor shortage is also going to require construction contractors to reconsider how a flex staffing strategy fits into—and benefits—their workforce.
Learn More About Flexible Construction Staffing for Your Workforce
For two decades, Tradesmen has helped contractors weather construction labor shortages and maximize productivity. Our tried-and-true skilled labor staffing strategy, called CORE+Flex, is designed to help businesses thrive. Let us help you evaluate your workforce strategy, starting with a no-cost labor productivity analysis. Contact us today to put in play a lean staffing strategy and request a free labor productivity analysis and consultation.