Booming construction markets are cutting the industry’s unemployment rate and expanding companies’ worker head counts, but stubborn workforce gaps are still creating bidding and safety headaches for employers.
In its 2016 business and hiring outlook, released on Jan. 6, the Associated General Contractors reports that 71% of 1,500 survey respondents say they will increase employee numbers this year to meet improving private- and public-sector markets. Respondents were most optimistic about the retail, warehouse, health-care and office-construction segments in the private sector and education and public buildings in the government sector. The findings track with U.S. Bureau of Labor Statistics’ numbers, released on Jan. 8, that show construction unemployment continuing its year-over-year drop. It fell in December to 7.5% from the year-earlier 8.3%, as firms added 45,000 jobs even as winter slowdowns worsened the rate from November’s 6.2% figure.
Individual firm hiring will remain modest, with key worker shortages a stubborn problem, AGC’s survey respondents acknowledge. Two-thirds say 2016 hiring will increase their head count by 25% or less, and 70% report difficulties in filling key craft and professional positions, despite increased base pay rates and bigger investments in employee benefits.
Mike Kaiman, a Turner Construction vice president in Texas, says state contractors are not benefitting in a major way from the growing unemployment among workers in the oil-and-gas sector, noting challenges by construction firms to provide “the lifestyle of working multiple shifts, unlimited overtime and high weekly paychecks.”
Josh Clardy, president of a $10-million contractor in Myrtle Beach, S.C., says firm vacancies are limiting its ability to pursue new work without risking oversight on existing projects. Gary Smith, president of Seattle contractor Lease Crutcher Lewis, says he is coping with workforce gaps in the region’s tech-driven construction boom by increased recruiting from other areas of the country. But he remains concerned about the lack of affordable area housing for employees and the impact of more frequently needed overtime on worker fatigue and injury rates.