Is There a Construction Worker Shortage?

It seems crazy: Just a few years ago, millions of workers lost their jobs after the housing market collapsed and the economy sank into recession. And now there’s a shortage of construction workers?

Do a quick Google News search and you’ll find reports of construction worker shortages all over the country. A few examples:

  • In Chicago, new home prices are up 10 to 15 percent in part because of a shortage of workers, CBS 2 Chicago reported after interviewing builders there.
  • Construction firms in the south are struggling to find workers, according to the Nashville Tennessean. An HR manager for Turner Construction said there are plenty of qualified college grads for project manager jobs, “but in the skilled labor area, it has been a challenge.”
  • In Ohio, the CEO of Elford construction told the Columbus Dispatch: “We’re not seeing anywhere near the number of young people entering the industry as we need.”

The latest Bureau of Labor Statistics report says the construction industry’s unemployment rate is 7.5 percent—higher than the national average but still the lowest it’s been in 7 years.

So construction jobs are coming back, but there aren’t as many people qualified and willing to do them. This suggests that construction workers who lost their jobs during the recession either found other things to do (changing careers, going back to school) or left the workforce.

For contractors, who already have plenty to worry about, this trend brings more uncertainty.

Industry groups have been warning of an impending worker shortage for years, and some states have even produced public service announcements to encourage people to pursue construction careers. Last year, the state of Alabama enlisted the help of Dirty Jobs host Mike Rowe to help spread the word that construction labor is a viable career choice.

widely-cited report by the Associated General Contractors of America from earlier this year identified a series of policy failures and outside trends that have contributed to a construction worker shortage.

The report says:

“These workforce shortages may at first seem counter intuitive for an industry that was forced to lay off more than 2 million workers since 2006. However, these shortages are the consequence of a series of policy, education, demographic and economic factors that have decimated the once robust education pipeline for training new construction workers.”

Some of the solutions the AGC proposes include more funding for technical schools and training programs, policy changes to encourage apprenticeships, and immigration reform.

Those ideas might work. But if you have a building to build now, you can’t wait around for the slow-moving wheels of government regulations. You need people yesterday.

The economic recovery has been a relief for the construction industry, but it also brings new challenges. The firms that benefit most will be the ones who navigate the worker shortage to recruit the right people and manage them intelligently.

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