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The Skilled Labor Shortage Isn’t Going Anywhere: 5 Tips to Help Builders Survive

With numbers nearing the Great Recession, 92% of contractors are saying they have had “moderate to high levels of difficulty” finding skilled work, showcasing the extreme nature of our current skilled labor shortage in construction. Unfortunately, it seems the skilled labor shortage is going to continue for the foreseeable future and the industry is struggling to adapt. 

One option is to proactively prepare and adapt our businesses to survive. Below, we discuss the U.S. skilled labor shortage and arm you with the necessary skilled labor shortage statistics and strategies to help you persist through these challenges. 

A home in Raleigh with Nichiha fiber cement siding is centered underneath a tree with pink flower blossoms. The home has a driveway on the right with a brown garage door add-on, white siding, and a front porch with a thin roof.

The Ongoing Labor Shortage Issue

If you’ve been in the business long enough, you know this isn’t the first skilled labor shortage we’ve experienced (and odds are, it won’t be the last). In 2018, one-third of contractors had to turn down some projects due to rising construction costs, and 80% of construction firms reported having a hard time filling hourly skilled positions that represented the bulk of the construction workforce. 

The current shortage can be traced back to the 2008 recession. When the home construction industry bottomed out, not only did many skilled tradesmen leave the business, new job seekers didn’t join the trades. In all, during the Great Recession, employment in construction decreased by 2.2 million workers and the industry has struggled since then to gain those workers back.

To combat the current shortage, local contractors are attempting to offer higher and higher salaries and rates per hour to attract skilled labor. But in turn, this is significantly increasing the prices of overall projects, making homeowners leery and more likely to quote-hop to a competitor. 

Many contractors are claiming that this is the worst labor shortage in their 30+ years of experience in the industry. The magnitude of the struggle varies across regions. Right now, it’s especially noticeable in large urban areas due to the subsequently large construction demand. But, it is starting to trickle down and affect the rural areas, too. 

A brown, black, white, and stone accented home protected with Nichiha’s fiber cement siding sits atop a hill with a large driveway and blue, cloudy skies in the background.

The Effects of Labor Shortages on the Construction and Building Industries

So what other factors are influencing the labor shortage? Other industries are seeing what experts are calling “The Great Resignation,” a slew of resigning workers who are highly unsatisfied at work and feel more empowered to set their own terms for employment due to increased competition for labor. However, that’s not what’s happening in our industry.

According to a survey by Million Acres, job satisfaction in the trades is quite high, with 83% of skilled workers reporting satisfaction in their choice of job. It’s not a lack of wages either, as the average general contractor is earning 53% more than the U.S. average income. So, what is the real issue?

62% of respondents believe there’s a general lack of respect for blue-collar work, and they are leaving the industry. 54% of respondents think trade schools get overlooked in favor of four-year universities, resulting in the younger generation choosing to enroll in college programs instead of vocational or trade school. 97% of construction supervisors are male, as well as 90% of all skilled workers, so many say a clear pathway for women to enter the skilled trade world would make a difference in recruiting young, female talent.

Help Is On The Way

Looking for design or pricing assistance? Nichiha representatives are on-hand to answer your questions, ensure your detailing is technically sound and that your project meets all product and design requirements.

The construction industry also has a bit of a recruiting strategy issue. Only 37% of construction businesses utilize digital spaces for candidate recruitment, compared to the 80% of Americans who are using online search tools for job-hunting. 

What are all these labor issues doing to the industry as a whole?

Well, students have now returned to school in full force, but the supply of student housing is expected to be at an 11-year low in 2022. Home builders across the country have reported growing backlogs of homes to build, with many cutting off new orders altogether until they get a handle on demand. Nine out of 10 firms are reporting project delays in general, with six of those firms directly attributing the delay to workforce shortages. 

According to AGC, 93% of contractors have reported that rising labor costs mixed with rising materials costs have drastically affected their projects. Projects are harder and harder to profit from, and 37% are reporting unsuccessful attempts to pass any added costs onto project owners.

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How To Survive During This Labor Shortage

There are several ways your business can survive this most recent labor shortage. 

  1. Be open to candidates with less experience who show a willingness to learn on the job. 
  2. If you haven’t already, update and prioritize your digital presence, along with offering digital recruitment resources like a careers page on your website, Indeed or LinkedIn Jobs. 
  3. While many feel college to be necessary for today’s job market, a rising number of young people do not want to be burdened with overwhelming college debts. Young people are starting to realize the financial benefits of this profession and are openly pursuing a trade school education. Consider offering a sign-on bonus or special initiative to encourage people to join the construction industry. 
  4. You can advertise the benefits NAHB and NKBA discovered via research: good pay, the ability to obtain useful skills, the ability to work outside, career growth and the potential for entrepreneurship. Raising awareness of the building trades as a rewarding career path and mentoring a new generation of tradespeople will be critical in closing the skilled jobs gap.
  5. We’re currently in a worker’s market, so there’s little to no reason for unhappy employees to stay in jobs where they’re treated poorly. Do a gut check with yourself if employees are leaving. Are you paying fairly compared to the market? Are your benefits good? Are you committed to worker safety and is it clearly communicated to your workers? Have you listened to employee feedback, even the bad stuff? Take an honest look, and take action accordingly.

A grey, stone, and white accented home with Nichiha’s fiber cement siding is surrounded by a green lawn, a blue sky and a plethora of green trees.

How Nichiha Can Help 

One way to save on projects is getting flexible with your required labor, materials and installation processes. Nichiha products only need one installer, and your team won’t have to deal with a potential delay due to wait times for specialized workers, as you would with masonry for stucco and brick. 

Additionally, we are a proud provider of ongoing contractor training. We own a resource hub with installation manuals, and we offer video or in-person installation tools for your crew, helping your team learn the product and move through installation quicker and more efficiently. 

If you choose Nichiha for your next project, you can achieve multiple looks with one easy-to-use product, decreasing the time needed for learning new materials and different product types. 

To learn more, check out our resource hub or contact a rep to get your team trained.

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