Labor Shortage

The Impact of a Skilled Labor Shortage in Construction

The Impact of a Skilled Labor Shortage in Construction


The impact of the skilled labor shortage in construction has continued to plague the construction industry since the recession (2007-2011) where approximately 2 million construction workers were let go (more than any other industry). Ever since then, the construction industry has not been able to make up for this loss of skilled labor and has struggled to fulfill the many construction jobs that are becoming more readily available. The National Association of Homebuilders estimates that there are approximately 200,000 construction jobs that have been left unsatisfied due to the labor shortage. This inverse relationship between the availability of construction jobs and the availability of a skilled workforce is only going to continue to be a problem in 2017 as the promise of new infrastructure is coming from the new administration. The promising growth of new construction projects should be exciting news for the construction industry; however, it poses a challenge to construction firms as they struggle to be able to staff such large projects with enough qualified workers.


Here are some ways the skilled labor shortage has impacted the construction industry:


Many people are scared to join the construction industry.

The recession and layoffs of 2007-2011 lead to the loss of many of the skilled construction workers and professionals who had been in the industry for a long time. After these people had been let go, the construction industry was forced to start from square one, since many of the skilled workers were already let go and nearing retirement age. Also, many of the younger people entering the workforce have avoided construction as a career path due to its volatility of job security in the past.

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There is less of a focus on trades and vocational schools.

Another reason why fewer people are entering the construction workforce is the lack of emphasis on the trades in high school and college. Most young adults are being guided toward the traditional 4-year university routes and never consider learning a trade.


There are fewer apprenticeship programs.

The recession also led to fewer apprenticeships and internships. Apprenticeship programs typically allow the employer to “test out” new employees before hiring them full-time and allows the apprentice to gain valuable hands-on work experience. Without these apprenticeship programs, employers are hiring workers before their skills have been evaluated, and less young entrants to the workforce are gaining hands-on experience before being thrown into the field. This lack of apprenticeships has also led to a less skilled young workforce overall. If more construction firms were offering apprenticeships, it might not only attract young workers, but it would also act to head-start these new workers on their skill sets so that they might become highly skilled construction workers later in their construction career.


Less qualified workers pose safety concerns.

Safety concerns go hand in hand with the hiring of less than qualified workers to staff the increasing number of projects. This is a concern especially with a high-stakes job like construction, where a lack of skills can mean very devastating results.


Rising costs to both project owners as well as to contractors.

 Costs of construction projects have risen for both project owners, as they are forced to pay more to get a project completed on time, as well as for contractors who have had to increase compensation and benefits to attract new talent.

According to a survey conducted by Associated General Contractors of America, 52% of participants said that they had increased their base compensation for all workers, while 28% have improved benefits to stay competitive in the market for talent acquisition.


How does the construction industry combat this issue of a skilled labor shortage?


The construction industry must be able to demonstrate its value as a career to the upcoming workforce. There are many ways that the construction industry can do so:

Reaching out to the younger generations

Construction firms need to partner with local schools to be considered by young adults as a career path worth pursuing. This partnership will lead to opportunities to appear at career events, speak in front of classrooms, appear on the school’s career connection websites, and many other benefits. By visiting local high schools and colleges, construction firms will be able to get young adults thinking about a career in construction before they finalize their career path.


Investing in training programs

To create a more highly skilled workforce overall, construction firms need to invest in training for all employees. To do so, construction firms should have extensive training for all new employees, refresher training courses for all-level employees, and mentorship programs that will allow the senior workers to pass along their knowledge to the younger working generation before they retire.


In addition to skills training, construction firms should also utilize training from the Occupational Safety and Health Administration in order to train new employees to improve safety on-site.



With the promise of new construction jobs only continuing to grow, there has never been a more vital time for the construction industry to take steps to combat the skilled labor shortage. Small steps taken to reposition the construction industry as a viable career option for new entrants to the working world will make a massive difference for the construction industry in the long-run.


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