One of the biggest challenges facing the commercial construction industry is the availability of skilled workers. In addition to its typical annual hiring rate of 400,000 workers, the construction industry needs to hire an estimated 546,000 additional workers in 2023 to meet current construction labor demands.
Compounding this issue are shifting generational values that prioritize workplace flexibility, wellbeing and social responsibility. Consequently, the industry must transition from traditional human resources practices to strategic talent management.
To address this need, organizations must ensure business goals are adequately supported by human capital strategies for recruiting, training, managing, supporting and compensating talent. Talent departments can deploy strategies to create a culture that attracts and retains the ideal talent using four key strategies: strategic workforce planning, employee performance management, employee development and career pathing, and creating a culture of wellbeing. These strategies have proven beneficial in tackling the industry’s talent (or lack thereof) challenges.
STRATEGIC WORKFORCE PLANNING
In an age of rapid technological advancements, flexibility and adaptation are necessary to survive. According to a study by McKinsey & Company, the productivity growth of the construction labor sector is trailing behind that of other industries. Contributing factors include the cyclical and fragmented nature of the industry, extensive regulations and lack of emphasis on skills training, research and development, and innovation.
Workforce planning is pivotal to improving construction labor productivity. When integrated with the business plan, this initiative establishes effective and sufficient hiring plans and targets as well as compensation budgets. Planning for project staffing, equipping team members with the right experiences and exposure, and offering on-the-job support, ensures a well-prepared organization with the right talent for growth and change.
Building the interest of the next generation of workers to enter the industry is also an important strategic initiative. SkillsUSA, which partners with educators and construction industry professionals across the United States, prepares high school students for careers in trade, technical and skilled services with real-life job experience.
EMPLOYEE PERFORMANCE MANAGEMENT
How can companies consistently and measurably manage people to ensure alignment, accountability and fair compensation? Amid the current talent war and increasing challenges with retaining a high-performing workforce, this question should be at the center of every talent management strategy.
An effective performance-management system optimizes employee performance while adapting to changing business conditions. This involves aligning business plans with talent strategies to establish processes for measuring and managing employees.
At the forefront are tactics that swiftly identify competency or skill gaps so that the appropriate training and development programs for workforce growth can be designed and deployed. For example, Swinerton’s comprehensive performance-management process assesses three components of success:
1. Cultural Values: Evaluating whether team members embody cultural values and take action to improve themselves and their environment.
2. Business Skills: Assessing the team members’ ability to use resources efficiently.
3. Technical Skills: Measuring the team members’ ability to produce the expected output.
Some companies even develop a career blueprint for all skilled positions, outlining the skills, training and expertise needed for each employee to move to the next career level. This establishes a strong culture of retention inspiring employees to grow their careers and seek success beyond project-specific opportunities.
EMPLOYEE DEVELOPMENT AND CAREER PATHING
Boundless opportunities exist to launch a career within the construction industry, especially for skilled craftspeople interested in advancing to managerial roles.
Basic carpentry skills training supports the broadest range of positions and, therefore, is an ideal starting point to expeditiously and safely move new hires to the jobsite early in their careers, resulting in job satisfaction and a greater sense of loyalty.
Upskilling programs can support employee development in existing roles while offering a clear growth path for future stages of a career. Various programming includes:
1. Onboarding fundamentals for a strong start to the role
2. National Center for Construction Education and Research apprentice training program for journeymen
3. Targeted foremen and superintendent national development programs
4. Professional development programs focusing on mandatory leadership and management skills for successful advancement
5. Technical bootcamps providing hands-on construction fundamentals and best practices for project engineer, project manager and project executive.
Development goes beyond training alone. Customized, individual development may also involve mentorships, coaching, cross-training, job rotations, stretch assignments, internal mobility, networking opportunities, continued education and certifications. This holistic approach further demonstrates that employees can fulfill their career aspirations within the company.
CREATING A CULTURE OF WELLBEING
As with other labor-intensive industries, the construction industry faces mental health challenges necessitating companies to prioritize employee adjustment, satisfaction and work-life balance. Contributing factors include:
1. Long work hours and potential for excessive overtime leading to fatigue
2. Limited job control
3. High stress and deadline driven work
4. Valuing toughness and strength, which may deter seeking help
5. Separation from family when working away from home
Companies can address these issues by implementing wellbeing strategies that offer webinars and programs on mental-health best practices, targeted managerial training to foster a culture of wellbeing, free therapy sessions through an employee assistance program and the evaluation of employee workload and project staffing.
Furthermore, creating a diverse and equitable work environment with supportive peer mentorship opportunities also contributes to employee wellbeing and job satisfaction. Affinity groups such as LGBTQ+ employees, working parents, minority employees and women, inspire solidarity among professionals at various career levels, promote workplace culture and proffer aspirations for advancement and growth.
TALENT MANAGEMENT JOURNEY AND EVOLUTION
Today’s employees seek more than a paycheck or career advancement; they desire meaning, personal fulfillment, professional development and authentic workplace relationships. Embracing strategic talent management enhances organizational flexibility and performance and workforce productivity.
Companies prioritizing true career pathing, skill-building opportunities and worker wellbeing will differentiate themselves in the market. Establishing an emotional connection between employees and the company’s purpose fosters strong engagement, retention and productivity.