AGC Survey Results Address Labor Shortages and Optimism in Industry’s FutureSeptember 23rd, 2021 by Luly Hernandez
The construction industry is seemingly struggling in more ways than one, but officials with the Associated General Contractors of America (AGC) notice some positives from the 2021 Workforce Survey.
“This year’s results show an odd paradox,” said Steve Sandherr, the CEO of the AGC. “On the one hand, construction firms are experiencing pre-pandemic levels of workforce shortages. At the same time, many construction firms are dealing with the impacts of delayed or canceled projects, suffering from construction materials shortages, delivery delays and lagging demand.”
AGC hosted a virtual discussion with Autodesk to evaluate the state of the construction labor market with data taken from their Workforce Survey. The annual survey provided insights into how the ongoing pandemic is impacting the construction industry and the availability of workers to hire.
Sandherr also expressed optimism when it comes to circumstances finding some stability. He said that many of the challenges affecting contractors result from policy responses to the pandemic instead of reflecting typical market conditions.
“Once the pandemic wanes and policies that have kept people from seeking employment expire, demand for construction is sure to rebound and the labor pool is likely to expand,” Sandherr said.
During the discussion, Ken Simonson, the association’s chief economist, said nearly nine out of ten firms (88%) are experiencing project delays, and among these firms, 75% cite delays due to longer lead times or shortages of materials. Additionally, 57% cite delivery delays.
“Sixty-one percent of firms said their projects are being delayed because of workforce shortages among their teams or those of their subcontractors,” he said. “Delays due to the lack of approvals or inspectors or an owner’s directive to halt or redesign a project are each cited by 30% of contractors.”
Simonson also addressed the labor shortage that is plaguing so many businesses. “Eighty-nine percent of firms that are seeking to fill hourly craft positions report having a hard time doing so. And 86% of firms seeking to fill salaried positions are also having a hard time.”
“There are two main reasons so many firms report having trouble finding workers to hire. The first is that 72% of firms say available candidates are not qualified to work in the industry due to a lack of skills, failure to pass a drug test, etc. And 58% of respondents report that unemployment insurance supplements are keeping workers away.”
According to the survey, many construction firms are making an effort to address the shortages. Simonson said that 37% report having had engaged career-building programs at the high school, collegiate or career and technical levels, and 31% added online strategies, such as Instagram live, to better connect with younger applicants. Others used a staffing firm.
“Roughly a quarter say they have partnered with government workforce development or unemployment agencies, or used software to track vacancies and job applications.
Almost one-third of firms report they have increased spending on training and professional development. Twenty-six percent have lowered hiring standards, while 24% have increased the use of virtual learning programs to supplement training efforts.”
Allison Scott, director of construction, thought leadership and customer marketing at Autodesk, also expressed optimism regarding the industry’s future.
“Although we are still in the midst of a labor shortage, it’s really promising to see the industry branching out in new ways and investing in hiring, training, professional development and technology, and I think it indicates a cultural shift in construction that can pay dividends in the long run,” she said.
Sandherr also addressed those in public office, and called on the federal government to invest more in career training.
“The federal government currently spends only one dollar on career training for every six dollars it puts into college prep,” he said. “That is $120 billion a year for colleges and only $20 billion a year for career training, despite the fact only one in three jobs requires a full college degree. This funding gap for career training is one of the main reasons so many contractors have a low opinion of the current pipeline for preparing new craft construction professionals.”
He also said that federal officials should drop efforts into passing the PRO Act and that AGC is “fully engaged in urging House officials to quickly pass the bipartisan infrastructure bill.”