Construction Labor Shortage
The current construction boom shows no signs of slowing down so contractors must be enjoying the ride, right? Well yes, but contractors still face a major challenge in the form of a shortage of skilled labor. An article from Builder states that "construction job openings [have] reach[ed] [an] eight-year high" 1. Many skilled workers left the industry in the last recession and did not return with the current construction wave. There are also fewer high school graduates going into the construction trades as the profession’s reputation struggles against high tech knowledge jobs with "young workers under 34 accounting for less than one third of the total workforce" according to Bureau of Labor Statistics data 2. So how does this labor shortage impact our current projects?
General Contractor Impact
For general contractors there are few options: luring workers from other industries, sourcing labor from other parts of the country, or leaving projects understaffed. New employees are part of the solution but there is still the need for proper training in both skills and safety. A great resource for equipping the next generation of skilled construction workers is the Construction Industry Training Council which Rafn has long been a part of, and has sent many employee through, for hands-on vocational trade schooling and training. At Rafn we focus on growing talent from within which helps avoid the risk of having to put new people in key positions. We have also managed our capacity to only pursue work that fits the staff we can count on.
Subcontractors are swamped in this explosive construction market. It’s difficult for them to turn down work when there are so many opportunities (many due to delayed project start dates). However, working with subcontractors to determine whether their resources can provide quality work on schedule is critical. During pre-construction we collaborate with key subcontractors on the manpower requirements of our projects and their other commitments. Do they have the skilled labor to staff their work properly? A recent effort revealed that phasing certain scopes of their work throughout our project would yield a better result for everyone rather than them having to complete all of their work at one time in a single mobilization. Working with subcontractors and their manpower schedules early in pre-construction can have a significant impact on the efficiency and cost effectiveness of the project.
Similar to subcontractors, suppliers are struggling to keep up with the demand for product due to a lack of skilled labor in their production facilities. This creates scheduling concerns for the general contractor who needs to put the puzzle together in a certain order to maximize efficiency and minimize cost. One recent example on a project involves cabinets. Typically, cabinets are installed then the wood trim follows. Due to delays in the supply of the cabinets, we chose to install trim in the units before the cabinets. This change in sequence required us to leave the trim long to be cut to fit later but allowed progress to be made in units until the delivery of cabinets. The ability to be flexible and creative with scheduling is invaluable to the success of the project.
A slowdown in construction appears to still be a ways off and contractors, subcontractors, and suppliers will continue to focus on finding the skilled labor required to maintain schedules and budgets while completing these great new buildings that will benefit the Puget Sound region for years to come. At Rafn, we continue to thrive by keeping our teams productive and creative, forging quality relationships with our long-term subcontractors and suppliers, all while delivering a quality result.
Our next article on this subject will continue the conversation and dive into other implications of the labor shortage including cost escalation and quality control.
Rafn is hiring. If you know good people interested in the construction industry, please have them visit www.rafn.com/team.