Before the recession, one of the biggest problems contractors had was finding and retaining enough qualified managers and skilled workers. While the recession has temporarily reduced or even eliminated this problem, it will surely return when the industry emerges from the recession. In fact, it might be even worse. Since construction was hit harder than most industries, some of the people working in the industry may have decided to move on to other industries, and may not be willing to return after the economy starts to improve.
Construction industry employers are going to need a new approach. For the last 40 years or so, it has been recognized that the number one reason why people leave a company is feeling unappreciated. In contrast, one of the best ways to create employee loyalty is through continuing education, because it demonstrates that the company values the employee and cares. Of course, it costs money to develop people, but what’s the cost of using untrained people to do the work?
Industry consulting firm FMI has estimated the return on staff development to be about 15 percent. (Since most contractors make less than 15 percent, it appears to be more profitable to send people to class than out on the job!)
Of course, it doesn’t work that way, but I think it places the return in perspective. In the future, to be able to compete for workers, companies will be forced to provide continuous education. This idea has been confirmed in my radio interviews with top executives of successful companies. One advantage during a recession is there is more time for educational programs. Another benefit is that the industry is changing and those companies that invest in their employees' development will be prepared for the new environment and will have a substantial advantage over those that don’t.
Another key to the future is bringing new people into the industry, especially those currently in school. The national ACE Mentor Program has contractors working with high school students in a club-type format to get them interested in our industry. My radio interview with Pamela Mullender, the ACE President, offers additional information on the program. This concept is important because it allows contractors to start building relationships with potential future employees. Companies can offer intern-type jobs to these students. This would provide valuable experience. Typically, the first few months of any employment is about learning the ropes, but these individuals would already have that mastered.
One survey found the most difficult position to fill is that of an engineer. That's not surprising. It’s a tough course and often individuals that could handle it are attracted to more lucrative careers. Further, with the cost of college continuing to increase, many potential students find they can’t afford it or are forced to attend night school or a community college, where engineering degrees are not available.
One solution would be for contractors to offer scholarships to students, with the requirement that they work so many years for the contractor after graduation. This, combined with summer employment, would provide employees that are just graduating college that are more like second- or third-year employees.
This approach certainly has some risks, but if employers work through the ACE Mentor program and hire interns, they would have a good idea of a student’s potential, therefore minimizing that risk. An intelligent, hard-working, conscientious student usually transfers into the same type of employee, therefore the risk would be minimal.
To be fair to the skilled mechanics and craftsmen, a different approach is needed for them, too. Instead of making the apprentices go to class on their time, companies should consider paying them while they are in class and pay for the training. Other industries do this, so it’s about time the construction industry escapes the dark ages. Of course, they would probably be required to work for their sponsoring company for a period of time after completing the apprenticeship program. However, this approach should produce some very loyal employees.
Finally, once the employee is on board, contractors need to commit to an ongoing development program. I realize this all requires a commitment by contractors, but keep in mind it’s a buyer’s market for employees, and if a company wants to obtain the best it will need to invest in the employee's future. Fortunately, that is also an investment in the company’s future.
Construction industry employers are going to need a new approach. For the last 40 years or so, it has been recognized that the number one reason why people leave a company is feeling unappreciated. In contrast, one of the best ways to create employee loyalty is through continuing education, because it demonstrates that the company values the employee and cares. Of course, it costs money to develop people, but what’s the cost of using untrained people to do the work?
Industry consulting firm FMI has estimated the return on staff development to be about 15 percent. (Since most contractors make less than 15 percent, it appears to be more profitable to send people to class than out on the job!)
Of course, it doesn’t work that way, but I think it places the return in perspective. In the future, to be able to compete for workers, companies will be forced to provide continuous education. This idea has been confirmed in my radio interviews with top executives of successful companies. One advantage during a recession is there is more time for educational programs. Another benefit is that the industry is changing and those companies that invest in their employees' development will be prepared for the new environment and will have a substantial advantage over those that don’t.
Another key to the future is bringing new people into the industry, especially those currently in school. The national ACE Mentor Program has contractors working with high school students in a club-type format to get them interested in our industry. My radio interview with Pamela Mullender, the ACE President, offers additional information on the program. This concept is important because it allows contractors to start building relationships with potential future employees. Companies can offer intern-type jobs to these students. This would provide valuable experience. Typically, the first few months of any employment is about learning the ropes, but these individuals would already have that mastered.
One survey found the most difficult position to fill is that of an engineer. That's not surprising. It’s a tough course and often individuals that could handle it are attracted to more lucrative careers. Further, with the cost of college continuing to increase, many potential students find they can’t afford it or are forced to attend night school or a community college, where engineering degrees are not available.
One solution would be for contractors to offer scholarships to students, with the requirement that they work so many years for the contractor after graduation. This, combined with summer employment, would provide employees that are just graduating college that are more like second- or third-year employees.
This approach certainly has some risks, but if employers work through the ACE Mentor program and hire interns, they would have a good idea of a student’s potential, therefore minimizing that risk. An intelligent, hard-working, conscientious student usually transfers into the same type of employee, therefore the risk would be minimal.
To be fair to the skilled mechanics and craftsmen, a different approach is needed for them, too. Instead of making the apprentices go to class on their time, companies should consider paying them while they are in class and pay for the training. Other industries do this, so it’s about time the construction industry escapes the dark ages. Of course, they would probably be required to work for their sponsoring company for a period of time after completing the apprenticeship program. However, this approach should produce some very loyal employees.
Finally, once the employee is on board, contractors need to commit to an ongoing development program. I realize this all requires a commitment by contractors, but keep in mind it’s a buyer’s market for employees, and if a company wants to obtain the best it will need to invest in the employee's future. Fortunately, that is also an investment in the company’s future.
Ted Garrison is a construction industry expert and civil engineer with more than 25 years of construction experience. During the last 12 years, he has authored Strategic Planning for Contractors and co-authored five other books on marketing, sales, customer service and leadership. Garrison also is the host of the Internet radio program, New Construction Strategies, www.NCS30.com, where he conducts weekly interviews of experts within the construction industry. He can be reached at Ted@TedGarrison.com or you can follow him on Twitter, @TedGarrison
