AGC Survey Highlights Critical Shortage of Construction Workers

Eighty-two percent of those surveyed see no relief in finding qualified craft workers in the next 12 months. Seventy percent expect the market for construction professionals will remain tight or become tighter in that period.

“As the survey results make clear, many construction firms across the country are having a hard time filling available positions,” said Ken Simonson, chief economist for the Associated General Contractors. “Considering how much the nation’s educational focus has moved away from teaching students career and technical skills during the past few decades, it is easy to understand why the construction industry is facing such severe labor shortages.”

Regionally, worker shortages appear most severe in the Southeast, where 86 percent of contractors report having a hard time finding qualified workers. For the rest of the U.S, 84 percent of contractors in the Midwest, 82 percent in the West and 67 percent in the Northeast report difficulty finding workers.

Part of the shortage problem is due to retention of skilled workers. During the recession the industry laid off more than 2 million workers. Although AGC cannot track the transition of individual workers, anecdotal reports show many of those retired, moved to other industry sectors, or moved to different geographical areas.

Despite offers of higher pay, benefits and bonuses workers are continuing to leave or not choose the construction industry as a career. In the recent survey, 28 percent of firms said they lost craft workers to other local construction firms while 15 percent said workers moved to firms in other parts of the country. A quarter of the respondents said their craft workers were lost to other industries in the area, or around the country (15 percent).

During the AGC media call, a construction firm in the Northwest reported that during the recession their workforce dropped from 70 employees to 20. Of those, 20 percent retired, taking superintendants and highly skilled, long-term employees out of the industry.

AGC reports, “According to the U.S. Census Bureau’s 2012 Current Population Survey, roughly 44 percent of the construction workforce is 45 years of age or older and nearly one out of every five construction workers is 55 or older. That means there is a minimum of 1.1 million construction workers who are likely to retire within 10 years.”

The loss of experienced workers is especially crucial considering that the training pipeline for new craft workers is considered to be poor or below average by 55 percent of firms surveyed. Professional construction worker training is also considered inadequate with 35 percent of those surveyed calling it poor or below average.

Although AGC members are primarily focused on commercial construction, the difficulty in finding skilled labor crosses all industry sectors, including residential construction.

Part of the shortage is due to a national shift from a vocational to a college preparatory paradigm over the past several decades. A trend that AGC finds troubling in light of the fact that vocational training programs have higher graduation rates—90 percent versus 75 percent for college preparatory programs according to the U.S. Department of Education’s Office of Vocational and Adult Education.

Funding for career and technical education has declined 29 percent over the past eight years to a level of $1.12 billion in 2014, according to AGC. A number that AGC says must return to the 2007 level of $1.3 billion through reform and funding of the Carl D. Perkins Career & Technical Education Act.

The shift has had the effect of creating an impression that technical education is unacceptable, says AGC, even though industry and construction jobs often pay better than post-college options, especially since the recent downturn.

AGC has designed a plan, Preparing the Next Generation of Skilled Construction Workers: A Workforce Development Plan for the 21st Century, in response to the growing worker shortages. The plan includes increasing funding for vocational education, establishing construction-focused schools, and revitalizing apprenticeship programs.

Several states have recently introduced legislature to re-instate vocational training at the middle school, high school, and community college levels in an effort to recruit new workers to industrial careers. In 2011, Oregon state legislatures passed a bill that approved state funding for career and technical education (CTE) that was increased in each subsequent year. In January 2014, 8.7 million in grants were allocated for career and technical education.

AGC also encourages immigration reform that will allow legal access for significantly more construction workers to enter the U.S. to fill immediate demand while reforms outlined in the plan replenish the supply of domestic construction workers.

AGC says its goal is to “make sure that firms that once struggled because of lack of work don’t have to continue suffering because of a lack of workers.”

More information on this subject can be found at the Associated General Contractors of America website, agc.org