Construction trade industry group says most contractors struggle to find skilled labor

Eight out of 10 U.S. construction firms are having a hard time filling hourly craft positions that represent the bulk of the industry’s workforce, according to the results of a national survey released Tuesday (Aug. 28) by Autodesk and the Associated General Contractors of America.

AGC officials said the industry was taking a range of steps to address the situation, including boosting wages and benefits packages and compensation, but called on federal officials to takes steps to assist those industry efforts.

“Workforce shortages remain one of the single most significant threats to the construction industry,” said Stephen Sandherr, AGC’s chief executive officer. “However, construction labor shortages are a challenge that can be fixed, and this association will continue to do everything in its power to make sure that happens.”

Sandherr noted that 80% of the 2,000 survey respondents reported difficulty filling hourly craft positions. All four regions of the U.S. are experiencing severe craft worker shortages, the survey said, with 83% of contractors in the West and South reporting a hard time filling hourly craft positions, almost identical to the 81% in the Midwest and 75% in the Northeast.

Seventy-three percent of firms report it will continue to be hard, or get even harder, to find hourly craft workers over the next 12 months. One reason for their worries is that contractors are skeptical of the quality of the pipeline for recruiting and preparing new craft personnel. Forty-five percent say the local pipeline for preparing well-trained and skilled workers is poor. Another 26% said they had difficulty finding workers in the pipeline who can pass a drug test.

The industry-wide labor shortages are also prompting many construction firms to boost pay and compensation, according to the survey. Two-thirds of firms report they have increased base pay rates for craft workers, while 29% report they are providing incentives and bonuses to attract craft workers. Firms are also taking a greater role in developing their own workforce. Forty-six percent report they have launched or expanded in-house training programs and half report getting involved in career building programs.

“Construction workforce shortages are prompting many firms to innovate their way to greater productivity,” said Allison Scott, head of construction integrated marketing at Autodesk. “As the cost of labor continues to increase and firms look to become even more efficient, technology can enable better collaboration and ultimately lead to more predictable outcomes. There is also opportunity in untapped pools of talent such as tradeswomen, veterans, and young people looking for an alternative to the traditional four-year university.”

Scott noted that 29% of firms report they are investing in technology to supplement worker duties. One-fourth of firms report they are using cutting-edge solutions, including drones, robots and 3-D printers. Meanwhile, 23% of firms report they are taking steps to improve jobsite performance by relying on lean construction techniques, using tools like building information modeling and doing more off-site prefabrication.

Even as the industry works to address labor shortages, 44% of construction firms report they are increasing construction prices and 29% are putting longer completion times into their bids for new work because of the lack of workers, putting future development and infrastructure projects at risk.

AGC officials are pushing Congress and the federal government to boost funding for career and technical education. They also called on federal lawmakers and policymakers to allow more immigrants to enter the country to work in construction, let construction students at community and career colleges qualify for federal Pell Grants, and make it easier for firms to establish apprenticeship and other training programs.

The AGC monthly industry report shows that construction employment grew in 255 out of 358 metro areas between July 2018 and July 2019, declined in 56 and was unchanged in 47. Link here to see the national survey results, analysis of the data and regional and state-by-state results, which does not include Arkansas data.