September 2008: Cover Story

Call of the Contractor
Preparing the Next Generation Through Workforce Recruitment and Retention
By Jason Morgan

Summers spent toiling away at part-time jobs amount to nothing more than busy work and spending cash. We quickly realize that these nickel-and-dime positions are not going to cut it when our needs and wants grow beyond impulsive buys and beer runs.

Although money is a motivator, we also grow to need a purpose, a drive, a reason for waking up in the morning that goes beyond monetary value. We need more than just a job. We need a career.

And there’s no shortage of careers in the construction industry; in fact, the number of openings in the field is approaching crisis status. Throughout the U.S., 75 million Baby Boomers will reach retirement age by 2020, with only 45 million Generation Xers to fill the gaps. In the construction industry alone, 1 million new construction workers will be needed by 2012 and there will be 2.4 million skilled production jobs — machinists, machine assemblers, operators and technicians — available, according to the Department of Labor. Even scarier — the average age of a construction worker is 52, according to the Association of Construction Publications.

“As much as any other industry across the United States, the loss is more pronounced in the construction industry as the populations that have joined the industry have dwindled,” says Chason Hetch, President of Retensa, an employee retention services firm based in New York City. “The immediate effects we’ve already seen — project delays, increased cost, ability to take on and complete projects — you can’t take on and finish projects when you don’t have the people to do it.”

Combined with a dipping economy and you have a recipe for a worker shortage catastrophe 10 to 15 years down the line. If there was ever a time to start working on a solution, that time is now. The dip in the economy has hit many construction segments hard — particularly residential construction — but utility and infrastructure construction and rehabilitation isn’t going away. The need for water, electricity, gas and fiber remains. So, the economic dip has given utility contractor employers a chance to catch their workforce up to their project demands, says Hetch. But for a contractor who doesn’t start hiring and training future foreman and project managers now, more difficult times lay ahead when our
cyclical economy picks up.

“There are a number of bright spots,” says Mark Bridgers, Senior Director of Public Relations for FMI Corp., a leading management consulting and investment banking firm for the construction industry. “Several industry organizations and associations have taken a more aggressive approach in their promotion of attraction and retention efforts. The challenge is how to make a measurable impact over a reasonable time frame.”

Times have changed, and so have the battles for the construction field to fuel interest in the industry. The sky-rocketing cost of living, rapid development of technology and emphasis on continued education in college and beyond are just a few of the factors working against the construction industry in the younger generation’s perception. In a survey of 1,200 middle and high school students across the U.S. conducted by the Association of Equipment Manufacturers (AEM) in 2008, only 16 percent viewed the construction industry positively.

“It’s a big question, ‘Why does the pool of potential workers think better or worse about these great employment opportunities?’” asks Rich Jefferson, Senior Director of Public Relations for AEM. “I don’t know if we can ever answer that question adequately, but we can certainly take actions that will improve the perception of those opportunities.”

And at this point, the “why” is moot. Contractors are beginning to understand how important it is to start working toward changing that perception. In our current society driven by information and technology, an important message to get across to the younger generation is that today’s construction field is a blend of both mental and physical abilities.

The average age of the construction worker is 52, and in four years, there will be 1 million construction jobs available. The time to generate interest in the construction industry and push for vocational and technical schooling is now.

Perhaps the most successful campaign for getting youngsters involved in the industry, to date, has been the AEM Construction Challenge this year. Holding five regional rallies that attracted 1,200 students from across the United States, the Construction Challenge was developed by AEM, in association with Destination ImagiNation, a community-based, school-friendly program that builds participants’ creativity, problem solving and teamwork in enjoyable and meaningful ways. This program is designed to engage the interest of teens in careers in the industry through a hands-on, educational experience. The 15 regional events culminated in more than 50 student teams competing at CONEXPO-CON/AGG this past March in Las Vegas.

“Having the presence of children at CONEXPO-CON/AGG enlightened contractors and industry professions to the fact that, unless they have a son, daughter, niece or nephew, they really didn’t know what the youths’ interests are,” says Erin Babcock, Marketing Manger of Workforce Development for AEM. “While we saw the kids have a positive reaction, we also saw the spectators of the construction challenge just wowed by these kids.”

Next year, the Construction Challenge plans to hold regional rallies in 15 states and increase its exposure to more than 3,000 students. But it’s important to remember that kids’ opinions are shaped and derived from the older generation that are made up of parents and educators, and their interest is also imperative to rebuilding the construction industry’s image, getting vocational programs back into schools and reestablishing technical schools as a viable career-building option.

“What we’ve advocated to our sponsors, member companies and allied associations is to reach out not only their teams, but the schools those team members belong to,” says Babcock.

“That’s really a critical point,” adds Jefferson. “One of the things I noticed when attending one of the Construction Challenge regional rallies was the interest of local educators who worked with the teams. As we increase awareness with educators we are going to increase interest in the construction industry and its issues, especially as we highlight the benefits to the community. If you can get the public school educators to think about your issue, then they’ll talk about it with their kids.”

More and more associations and companies are initiating programs to spur interest in the construction industry programs rolling. The ACE Mentoring Program of America Inc. is working to create hands-on opportunities for young people to learn that the construction industry offers a wealth of high-paying, high-opportunity positions that touch every industry. An ACE event generally consists of teams of 15 to 25 students and industry mentors. Each team is set up to emulate an actual design team, with students guided through a mock design project by their architect, engineer and construction management mentors. Several companies will be assigned to each team, each providing one or two mentors. Mentors guide the students as they work towards a final project, introducing them to the careers, industry vocabulary, and various roles companies play in the construction industry.

“More ground level work by organizations like ACE will begin helping to change the perception of the construction industry,” says Bridgers. “There are a couple key qualities young people find attractive in a career — ability to have an immediate impact, the opportunity for and receipt of training and skill development and the use and application of technology. These are all areas that the construction industry can offer in abundance but which are frequently overlooked or under-emphasized in our recruiting efforts.”

The application of technology is especially important to the plugged-in Generation Y, or Millennials. For a generation that spends more time on the Internet per week than watching television, the implementation of online communities can also be beneficial for techno-savvy contractors looking to gain more attention from young online users.

“According to an analysis of the most recent Facebook [a popular online social network] advertising data, over 50 percent of the 20 to 30 year olds in the U.S. have Facebook accounts, based on a comparison of Facebook’s ad data and U.S. census bureau numbers,” says David Wilkins, Senior Director of Social Learning Products for Mzinga, a provider of business social media and learning solutions that drive growth and innovation based in Burlington, Mass. “This is also born out by a recent digital consumer study by IBM, which found that ‘the only content service with mass adoption (greater than 50 percent) was social networking, and this was only among respondents under the age of 35.’”

These characteristics make Millennials ideal candidates to take advantage of online workplace communities — an online social network centered on a company. Companies that can successfully attract and satisfy talented Millennials are likely to find that their friends are soon applying for jobs as well.

Connection and openness is in a Millennial’s DNA. This means that success with one will quickly spread to his or her friends, probably on the same day via text messages, a blog entry or a discussion board.

If the youth is the future, then what is the now? Non-traditional employees are a viable and immediate solution for the construction industry. These are people who typically wouldn’t be directly exposed to the industry — like ex-military, ex-offenders, the handicapped and those on welfare. The contractor isn’t on his or her own to track down these non-traditional employees; there are many employee placement services that can help construction employers find them.

“One of the benefits is that workforce development agencies will identify and place individuals in your company at no cost,” says Hetch. “They are subsidized by the government to place these disenfranchised workers. Some may specialize in the ex-offender populations, while others specialize in the disabled or welfare-to-work population. And most provide remediation so that their candidates have English skills and basic core communication skills, at no cost. So you don’t have to do it alone.”

When there’s a shortage of workers on a jobsite, worker productivity is paramount. If workers are at 90 percent productivity, that’s 10 more people you have to hire to be working at capacity.

To improve your chances of getting the right candidate for your team, it’s good to go into the hiring process with a profile of the type of employee that will succeed in the company. What’s the bull’s eye for who is going to do well in your organization? Non-traditional workers probably won’t come with a background in construction, so are you prepared to offer on-the-job training? Can you teach technical skills?

While that might seem like a lot of work and variables to recruit a new employee, it’s less expensive than searching for an employee on your own, especially when interest is waning. By taking the profile of who would fit your company into placement agencies, you’re more likely to end up with a good match.

It’s also important to be honest and up-front about the demands of the job. While a shortage of workers puts the pressure on deadlines, it’s not worth misleading someone just to get a body on the jobsite.

“In construction, there tends to be a lack of understanding and recognition of what the job entails,” says Hetch.
“Unfortunately in some contractor’s desire to hire, there’s a theme of intentionally or unintentionally overselling the candidates for hire and not telling the whole truth. And that does more harm than good. It’s in desperation, the job already started, they’re already two weeks behind, and they just need someone to pick things up and put them down.”

The need for long-term workforce stability trumps an immediate need for laborers, although it might not feel like that right now. Contractors need to look more toward training their next generation of employees, as opposed to just filling shoes on the next project.

Keeping an employee is just as important as recruiting one. After the time and money spent training the individual, not to mention the work relationships created within the company, losing an employee is not only costly, but detrimental to the team morale. The signs that an employee is possibly looking at other employment options are usually worn on the sleeve. Disconnecting from peers and conversations with a future focus, along with other behavioral changes, are tell-tale signs that you’re on the verge of losing an employee. By the time they are not interested in what will happen at work tomorrow, it may be too late.

“The No. 1 reason a person leaves a position is due to their manager,” says Bridgers. “In the construction industry, as with many other industries, we promote the most competent person in their current position, often with little insight into the skills needed for the promotion.

“In addition, most construction firms focus on technical skill development and offer very little in the way of management or leadership training. These ‘soft skills’ become much more critical as an individual moves up in an organization and begins managing others. As an example, the most technically competent welder on a crew is not necessarily the most qualified to lead the crew as a foreman or superintendent, yet it is typically this person who is tapped for promotion. Once promoted, this individual is unlikely to receive significant management or leadership training on how to best perform this new roll and the technical skills that took them to this position are not applicable or directly related to success in this new role.”

But there is a secret to retaining employees — ask your employees what they want. Sure, it seems like common sense, but it’s often the most over-looked tool in the management repertoire, according to Hetch. “For whatever reason, companies say, ‘we got to take everyone to a baseball game,’” he says.

“The reality is that one of the guys who has spent 10 years on the job says, ‘Why can’t I get decent health care coverage for my family? Why can’t I get comp time because I have new kids at home? Or another day vacation?’”

While perks and benefits might raise employee morale, it’s not a retention strategy. Employee retention isn’t a single-solution problem. Identifying needs, wants and expectations is the key to keeping current and future employees. And creating feedback loops is a great way to nip employee dissatisfaction in the bud. Develop a system in which employee frustrations, issues and concerns are communicated, received by management and then addressed.

In a time when the construction industry is struggling to rebuild its perception by generations both young and old, there is no room for disgruntled employees. The way our current workforce thinks of utility construction will have a drastic impact on younger generations — widening the gap between the reality of construction as a viable career future and the poor perception of construction industry. As our society changes, the industry has to adapt to the current trends and be sensitive to its workers’ current needs and future wants.

Jason Morgan is Associate Editor of Utility Contractor.