“But They Aren’t My Employees” – 3 Reasons the Construction Labor Shortage Belongs to the Owner

Bryant Black

Director, Workforce Development
Greater Houston Partnership

I’m sure you’ve read countless articles on the construction labor shortage and the lack of craft trade professionals who can meet the demand for building projects in our current environment.

But you are just the  construction project owner, and all of those people belong to your GC and their trade partners. This isn’t your problem to solve, right? Wrong!

We’ll show you three reasons owners need to be part of the solution for the craftwork shortage.

3 Ways Owners Can Address the Construction Labor Shortage

1. Don’t settle for cheap – “low price doesn’t always win.”
2. Require safety as a culture.
3. Expect highly trained professionals.

1. Low Price Doesn’t Always Win

Coming in on budget is a critical measure of success for building owners. However, as the skilled trade workforce shortage increases, project costs rise.

Owners are always looking for a project that can come in cheaper, but what drives that lower cost? The main variable for pricing between two competing trade partners will always be labor.

With turnover rates nearing 40%, according to a Construction Dive report, having enough crew to complete your project is often questionable. When low price wins, subcontractors are forced to become creative in how they employ skilled workers, including misclassifying or failing to pay workers correctly.

The cost of hiring a replacement for an entry-level $50,000 skilled worker averages 20% of their annual salary, or $10,000. That $10,000 shows up in the owner’s pocketbook in one of two ways:

  • As lost time on the schedule because of poorly skilled or newly skilled workers (and lost time always calculates to lost money).
  • Or it shows as rework and warranty work (and maybe it comes as both).

​Requiring a workforce that is both skilled and held as an employee by the trade partner in your contracting process creates an environment that prevents damage from the “low price always wins” approach.

Owners got to “low price” because the only thing that could shift was the cost of labor. It is time for owners to make the shift back to buying for quality as well as cost.

2. Require Safety as a Culture

Low price isn’t all that costs owners when you don’t own the workforce. Safety becomes critical when workers rotate in and out and have little or no training.

We find repeatedly that safety is directly impacted by the training received and the time on the job. A constant stream of new workers who have little or no experience on job sites or have previously been employed on less complicated job sites creates danger for multiple parties, including the following individuals:

  • The workers themselves
  • The workers around them
  • Visitors to the site
  • Owner representatives who may be touring the site

There is a reason we give them different colored hard hats to identify workers as new. When accidents happen, job sites lose productivity, workers become distracted thinking about the accident and filling out paperwork, and sometimes job sites can even be shut down.Accidents cost owners.

Again, asking for your general contractor or construction manager to require a certain level of safety training prior to working on the job site is a simple way for you to own a safer and more productive workforce.

  • What you ask for is what will get delivered because you hold the strings, the purse strings.
  • What you ask for in your bid is what you will get in your building.

If you want the right workforce to build your building, it’s important to set the tone from the very beginning that safety is a part of your company’s culture and your company’s culture extends to what your company builds.

3. Expect Highly Trained Professionals

For a long time, construction was just “blue-collar work,” but more and more, it’s becoming evident that it is a craft that requires time and practice to master.

You do not become a master plumber, master electrician, or master Mason overnight. It is time that we call them professionals like their project manager, architect, estimator, or business developer counterparts.

While construction workers do not earn their degrees in laboratories or classroom seats, they are professionals, nonetheless. Your favorite basketball player or football star didn’t learn their craft in a classroom either. If you want the best work, you must hire the best workforce.
Ask your general contractor to consider and weigh in the bid process the amount of training that each company provides for their craft workforce. This is one way that owners create a better place for craft professionals.

Own Up to Your Role Supporting the Craft Workforce

Technically, you don’t own the craft professional workforce. But, you can impact how they show up on your job and how your job gets done.

Asking for better employees on your jobsite elevates the playing field for the industry, which indirectly increases the likelihood that others who might be interested in the industry begin to see it as a valuable, honorable, life-long career.

Taking action now is the best way to address the construction labor shortage and increase the quality of craft workers available for your jobs. Achieving the desired result depends upon your own ability to do the following:

– Estimate better the cost of labor and materials to generate the quality of project that you desire, thereby creating a better costing model that rejects low cost always wins.

– Work with design professionals, construction partners, and community partners to facilitate conversation about the benefits of being part of the built environment in our community to recruit new construction craft professionals.

– Own your part of having created the problem. Commit to working with partners like Construction Career Collaborative (C3) to create a better future through a safer, more skilled, and sustainable workforce.

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