A huge segment of the construction worker industry lost their jobs between 2006 and 2009 during the decline of the US economy when the residential housing industry collapsed, and millions lost their homes because they could no longer pay the mortgage attached to rising interest rates. In the last few years, the need for new houses, remodeled homes, and commercial properties has increased dramatically causing an increasing need to fill an average of 225,000 construction jobs every month.
Because there is a significant decrease in the number of available skill laborers, many contractors are hiring inexperienced workers to ensure their jobs are completed on time. Unfortunately, this has resulted in significant safety concerns about dangerous job sites. (For information on construction accident cases, look here)
Statistics maintained by the US Bureau of Labor and the National Association of Homebuilders show that more than 2.3 million jobs were lost in the construction industry in the five years between 2006 and 2011. Many of these workers had to permanently move away from their construction job and seek employment in other industries, which significantly decreased the number of skilled contractors and laborers trained in framing, bricklaying, concrete work, plumbing, electricity, drywall, roofing, and other needed construction occupations.
Many of these valued trade workers were close to retiring or believed they are too old to re-enter the construction industry. The shortage of skilled workers has caused significant delays in completing construction projects and has increased the demand of current workers to get the job done quickly to meet scheduled deadlines.
Changes in population and society have also likely contributed to the decline in available skilled construction laborers as many millennials do not believe that working in a construction industry job as a worthwhile career choice. The prevalence of training and vocational schools has nearly vanished as many parents now steer their teenage children into white-collar careers after attending a four-year college program.
Worker migration is also another problem where workers have moved to other areas after experiencing or avoiding a natural disaster; like areas of the country that were hit by hurricanes in recent years. The Bureau of Labor claims that the labor shortage in the construction industry will likely not end anytime soon.
Making Safety of Priority on Job Sites
Hiring the best people is only part of the solution. Contractors must ensure that they maintain an effective risk management program by building a strong safety culture that manages the potential risks associated with a shortage in quality labor. The contractor should create and enforce safety rules, develop the best practices, ensure their employees are trained and follow safety regulations mandated by OSHA (Occupational Safety and Health Administration). It is the contractor’s job to provide expertise and guidance to their workforce.
Many worksites are filled with construction veterans with decades of experience working alongside new employees who have only been working in the industry for a few weeks. Some of these contractors know that hiring a less skilled workforce causes significant delays in completing the project with an increased cost that has the potential of causing more workplace injuries. These builders are already at their capacity to complete existing projects, especially in areas of the country that were hard-hit by natural disasters, like the forest fires in California and Hurricane Harvey, Irma, and Florence.
The significant uptake in the need for building residential homes has exploded in recent years although it is likely not to surpass the growth rates that occurred before the recession. This could be unwelcome news for the construction industry that does not have an existing, skilled construction labor pool to tackle any more projects.
Additionally, residential home-building companies are competing against commercial contractors, vying to hire anyone from the limited number of working construction job employees. Many contractors believe it will take years to get back to a skilled workforce that has gone through apprenticeship and certification programs. Other residential and commercial contractors have remained cautious after surviving the major real estate market slumped over the last ten years. However, time is of the essence. Statistics show that building permit applications for new residential houses and apartment complexes have risen 31% since 2011 when the industry was at its lowest point.
Using the Visa Program to Fulfill Jobs
In recent years, roofers and other specialty contractors who normally rely on foreign workers to fulfill seasonal occupational jobs have become confused. Initial reports revealed there was a serious shortage of H-2B visas based on a high demand. Last year, there were only 66,000 H-2B visa allotments to cover 82,000 applications.
Fortunately, Congress acted by raising the cap to approximately 130,000 visas. Unfortunately, the Department of Homeland Security has yet to issue the extra visas Congress allowed which has caused uncertainty about how well the program works, especially now that it has been decades since labor shortages have been as bad as they are now.
The drop in the unemployment rate to below 4% cause significant problems in the construction industry. Many specialty contractors face significant difficulties in hiring enough skilled workers to meet the demands of renovation and remodeling job. While some contractors are fluent in how H-2B visas work, others are confused about how the program works and whether it could solve their problem of a lack of qualified workers. The government has placed serious restrictions on allowing an out of country workforce to enter the United States to work in the construction industry.
The contractor should consider certain factors including:
- Timing – If the contractor is just now considering hiring workers through the H-2B visa program, they are likely already too late to get the application through the entire lengthy and complicated process. The Department of Labor requires the contractor to receive certification when applying for visas to hire out of country workers. The contractor will need to prove that there is currently no US employee to fill the open position. In fact, all other options will need to be exhausted before the contractor can advertise the job to others outside the United States.
- The Cost – In addition to the typical government red tape, the contract will need to put up the $460 filing fee that is a legal requirement to hire seasonal workers.
- The Uncertainty – Even if the contractor is successful at completing the entire process, they have no guarantee that the federal government will grant the H-2B visas. Currently, there is so much competition to hire outside help that it does not provide an easy solution for building a strong, skilled workforce.
A Long-Term Solution to Worker Shortage
There once was a time in America where nearly every school offered vocational education to show young students how to find a successful career path away from two and four-year colleges. Many of these educational programs have disappeared in high schools all across the United States. Currently, educators and parents have redirected many students to make academic-only decisions to find a career path that will ultimately leave many heavily in debt.
Members in the business trade are encouraging schools to reinforce their vocational education training by showing today’s students that there is a potential to earn higher wages, be self-employed, and increase their demand in the construction industry. Today, many high school students can gain valuable training in metal and wood shops to prepare them for a job in the residential and commercial building industry.
The Associated General Contractors of America are busy building a Workforce Development Plan to tackle labor shortages they believe “are the consequence of a series of policy, education, demographic, and economic factors that have decimated the once robust education pipeline for training new construction workers.” They believe that it will likely require more than just paying higher wages to fill construction jobs if the current worker shortage will ever be eliminated.
The Home Builders Institute along with other organizations have focused their attention on trade schools and educational programs to provide much-needed training to the at-risk teens and other groups including veterans and ex-offenders. Avoiding the traditional four-year college degree and learning skills in trade school can be a proactive step to ending the skills gap that is so prevalent in the construction industry today.
Employers Role In Minimizing Risks To Workers
Eliminating the ongoing demand for more workers in the construction industry will take time, effort, and an effective strategy. Until then, all contractors are at risk of having employees injured on the job because of unrealistic schedules to complete the project, and the lack of skills every worker has.
In the meantime, the industry will need to focus on training, education, and altering the perception of high school teachers, parents, students, veterans, and others in how they view making a good living in the construction industry. Contractors and employees will likely need to pay the skilled laborer more and reduce their weekly workload to ensure that the US economy, especially the construction industry, moves forward. There is currently no simple solution to get back on track after the devastating blow the construction industry took in 2008. Only time will tell how things work out.
For additional material on workers compensation, look here.