Worker shortage impacts building industry
Fully 94% of construction firms report having a hard time finding employees, undermining efforts to build infrastructure and other projects
According to a recent survey,1 the nation’s current level of investment in construction workforce education and training programs is having a real and measurable negative impact on the country’s ability to build infrastructure and other construction projects. The Associated General Contractors of America (AGC) and Arcoro, a leading HR technology company supporting the construction industry, conducted the workforce survey. Fully 94% of contractors reported they are having a hard time filling open positions. Construction officials called on federal leaders to adopt more robust workforce policies.
“The most likely path to addressing construction workforce shortages is for the federal government to adopt better workforce policies,” said Jeff Shoaf, AGC’s Chief Executive Officer, when the report was released earlier this year. “Federal officials need to support, instead of undermine, our national infrastructure and economic development policies.”
Firms reported having trouble filling at least some positions — particularly among the craft workforce that performs the bulk of on-site construction work. Association officials noted that 28% of contractors reported having at least 11 unfilled craft positions as of June 30, 2024.
According to AGC, the survey shows workforce shortages are impacting contractors’ ability to build projects. More than half (54%) of contractors reported experiencing project delays because of workforce shortages. Labor shortages are more likely to cause project delays than other causes, like supply chain challenges and shipping delays.
More training investment needed
One reason it is so difficult to find people is that there is a need for increased investment in construction workforce training and education. Shoaf noted that a report2 the association recently released in partnership with the Progressive Policy Institute found that federal officials invest four times more each year in encouraging students to earn four-year degrees than in supporting workforce development programs for fields like construction.
Construction officials noted that 62% of respondents reported that available candidates were not qualified to work in the industry because they lacked the required skills or certificates. Also, 43% reported that employees lacked required documentation like a driver’s license, work permit or clean background check. Half of firms reported that new hires fail to show up or quit shortly after starting.
Contractors are taking steps to overcome labor shortages. According to the survey, 91% of firms reported increasing base pay rates for hourly construction positions during the past year. In addition, 57% of firms reported adding online strategies to recruit younger workers, and 51% have engaged with career-building programs like high schools or training facilities.
Contractors are also increasing investments in internal training to address candidates’ lack of hard and soft skills. Almost half (42%) of firms reported initiating or increasing spending on training and professional development programs to address workforce shortages. Also, 26% reported increased use of learning programs with strong online or video components.
The survey also shows that construction firms are using human resources technology to address workforce challenges. Association officials noted that one in four firms reported using technology to deliver worker training programs. Meanwhile, 34% of respondents have partnered with a third-party firm to establish training courses and professional development.
Taking steps to help
Shoaf noted that the association is taking various steps to help the industry cope with labor shortages. AGC has partnered with its chapters to run more than a dozen targeted digital advertising campaigns to reach and recruit new workers. The association has created recruiting resources for member firms and its chapters, and it regularly hosts virtual and in-person gatherings to share workforce development success stories.
In addition, AGC chapters run a host of training and recruitment programs. They have partnered with local school districts to create new construction academies and pre-apprenticeship and registered apprenticeship programs. AGC chapters also build and support networks of career and technical education teachers and host dozens of construction career fairs each year, among many other workforce efforts.
However, association officials said more must be done to address construction workforce shortages. They called on Congress and the White House to significantly boost funding for construction-focused education and training programs. They urged Congress to allocate more funds for workforce training as part of the Workforce Innovation and Opportunity Act and to boost funding for in-school construction programs as part of the Perkins Vocational and Technical Education Act.
“Considering all that this industry and our association are doing to prepare, recruit and retain new workers, we are confident that better federal workforce policies will make a meaningful and lasting difference for the better when it comes to the construction workforce,” Shoaf added.
AGC and Arcoro conducted the 2024 Workforce Survey in late July and early August. Nearly 1,500 firms completed the survey from a broad cross-section of the construction industry, including union and open shop firms of all sizes. The 2024 Workforce Survey is the association’s 12th annual workforce-related survey.
By the numbers
According to the 2024 Workforce Survey:1
• 94% of firms are having a hard time filling open positions
• 54% of firms are experiencing project delays due to workforce shortages
57% of firms have added online strategies to recruit younger workers
