At the end of last year, construction employment reached its highest level since March 2008. According to analysis of government data by the Associated General Contractors of America (AGC), the increase in December alone was 38,000 jobs and 280,000 jobs, or 4%, over the past year, taking the total number to 7,352,000. Couple that stat with the reality that general unemployment hit a 50-year low in September at 3.7%, there’s more work out there than many construction companies know what to do with, and you’d think that might be a recipe for a hiring frenzy — not exactly in the electrical trade where everyone is competing to recruit, retain, and train the same people.
Based on the results of a new survey released in January by AGC and Sage Construction and Real Estate, most contractors plan to continue hiring in 2019. However, although 79% of construction firms plan to expand their payrolls in 2019, almost an equal percentage (78%) are worried about their ability to locate and hire qualified salaried and hourly craft positions. That number was down slightly from 83% at the start of 2018. In addition, 42% of respondents expect it will continue to be hard to hire in the next 12 months, and 26% think it will become harder to hire in 2019. “Construction executives appear to remain confident about their market prospects for 2019 and plan to add headcount to cope with the added workload,” said Stephen E. Sandherr, AGC’s chief executive officer, on a recent webcast. “Even as they are optimistic about growing demand, contractors are concerned about finding qualified workers to execute projects.”
That assessment mirrors the results of EC&M’s annual Top 50 Electrical Contractor Survey results, published in the September 2018 issue of the magazine, in which 87% of respondents admitted to having issues with worker shortages. Citing “recruiting and retaining qualified skilled labor” as their single biggest business challenge for 2019, 69% indicated they would add workers by the end of 2018 compared to 82% who reported boosting headcount in 2017. When it comes to hiring electrical workers, respondents ranked the following as the top four factors having the greatest influence on employee retention: competitive wages, positive company culture, strong safety record/risk management, and education reimbursement.
Many companies are also investing more in training programs for current and new workers, AGC officials noted, indicating that 63% of firms plan to increase investments in training and development in 2019, up from 52% at the beginning of last year. Large firms, in particular, are likely to do so, with 71% of companies with more than $500 million in revenue saying they plan to increase investments in training, compared with 59% of firms with $50 million or less in revenue.
“As growing demand and labor shortages force contractors to do more with less, many firms are increasing their investments in labor-saving technologies and techniques like building information modeling, lean construction and robotics,” said Ken Simonson, AGC’s chief economist on the same webcast, noting that 32% of respondents report their firms are using methods to reduce on-site work time, including lean construction, virtual construction techniques or off-site prefabrication, and 28% are investing in labor-saving equipment, including drones, robots, and 3-D printers.
It will be interesting to see how and to what level companies use these types of technological advancements to increase efficiency and streamline workflow in the coming year. Augmented/virtual reality tools will also be areas to watch. Whatever tools they choose to implement, it’s pretty obvious electrical professionals will have to get at least a little bit creative to win the talent war over their competitors.
