The Career Crisis in the Construction Industry: How Did We Get Here?

This article is the first in a series exploring the causes and potential solutions to the skilled labor crisis in the construction industry.Click hereto view the entire series.

Greg Sizemore, a construction industry veteran with four decades of experience, says he can't recall a time when job sites didn't have "Help Wanted" signs.

Sizemore—currently vice president of health, safety, environment, and workforce development at Associated Builders and Contractors—started as a laborer, thinking construction was just a summer job. He recalls contractors were looking for both skilled and unskilled workers even then. Today, the problem has only grown.

The issue is widespread: according to the U.S. Chamber of Commerce's latest Commercial Construction Index, 92% of contractors report difficulty finding construction workers, with 42% saying they have turned down projects because of it.

Here, Construction Dive breaks down the historical factors that led to this crisis, as well as various issues within and outside the industry that together create the challenge of understaffed job sites across America.

A look at the numbers

The construction industry's workforce crisis has been worsening for decades, but like many other sectors, the pandemic exacerbated the problem.

The number of U.S. construction workers peaked at 7.7 million in April 2006, before the Great Recession caused a sharp decline. According to Ken Simonson, chief economist at the Associated General Contractors of America, 2011 was the low point for construction employment, with 2.1 million fewer workers than in April 2006.

However, since 2011, employment has grown steadily. Simonson says that as of February 2020, total nonfarm employment had set records every month for five consecutive years, until March of that year. According to Bureau of Labor Statistics data, seasonally adjusted, the number of workers fell from 7.6 million in February 2020 to 6.6 million in March, a drop of about 14% in the early days of the pandemic.

Construction has begun to recover from the downturn, but it has not yet returned to pre-pandemic employment levels, while the high demand for skilled labor remains unmet.

The push toward higher education

One of the most long-standing reasons for the construction industry's labor shortage began about 40 to 50 years ago, when the U.S. shifted from an industrial economy to a post-industrial, service-based business economy, says Brian Turmail, vice president of public affairs and strategic initiatives at AGC.

Turmail notes that the idea that "every student should go to college" spread rapidly, supported by the GI Bill.

Sizemore says that for many parents and their children, success has come to be defined by a four-year degree, while trades like construction, plumbing, electrical work, and bricklaying have become "someone else's kid's" job.

According to the National Center for Education Statistics, in 1969, 8 million students were enrolled in degree-granting postsecondary institutions, with 5.8 million full-time. In 2019, that total reached 19.6 million, with 12 million full-time.

Additionally, over those five decades, the number of women in college surged: in 2019, 57% of higher education students were women. Yet construction has historically struggled to attract women to its workforce.

Neglect of vocational education

ABC chief economist Anirban Basu says the emphasis on higher education has led high schools to focus on reading and math tests, which, for both schools and students, has diminished the importance of courses like carpentry that are helpful to the industry, or even eliminated them altogether.

Turmail says this has also created a massive funding gap.

"For every $1 the federal government spends on career and technical education (about $20 billion a year), it spends $6 on college—supporting pathways from kindergarten through 12th grade to college," Turmail told Construction Dive. "So, the funding gap is $120 billion versus $20 billion... even though only about a third of jobs in the U.S. require a four-year college degree."

Still, Sizemore points out that college is not the best path to a career for everyone. According to the National Student Clearinghouse Research Center, as of October 2019, 36 million Americans had some college education but no degree and were no longer enrolled. Others may take more than four years to complete a bachelor's degree. That time could have allowed a budding worker to start and complete an apprenticeship and launch a career.

Working conditions

"We culturally devalue jobs that require getting your hands dirty, getting your body dirty, and being exposed to the elements," Turmail says.

Construction work is potentially dangerous. Hours are long and sometimes unstable. Workplaces are outdoors and frequently change. Even if workers aren't injured on site, they may suffer long-term damage or strain.

Turmail notes that the problem isn't just that working conditions can be hazardous. The average construction site starts before public transit begins running each day. For a young person, getting up at 4 a.m. to go to work, possibly without a car, can feel more like a sacrifice than for an experienced worker who is supporting a family and used to being woken by children.

Basu says that, combined with construction's failure to prove itself as a path to the American middle class, this makes it hard to sell.

Other groups invest time, effort, and money in recruiting services to show high school students that trade schools are a real option, but Sizemore says if those students aren't in the right zip code or within the reach of local contractors or industry groups, it's hard to reach them and encourage them to try the trades.

Retention challenges

Some potential employees never even really try construction work.

"I hear (AGC) members say, 'We have to hire two people for every position we fill because one will run off before the weekend,'" Turmail says.

But where do these workers go? Turmail jokes they might go to Starbucks, where starting pay can be comparable, but they don't have the long-term career opportunities that construction offers. He says those who can find work in energy and manufacturing often choose those industries.

Basu says this also happened during the Great Recession, when many workers left construction for the oil and gas boom, after the economic collapse had briefly created a labor surplus.

Basu says other workers make career choices based on the working conditions they want. Amazon built distribution centers across the country, invested heavily during the pandemic, and posted thousands of job openings. Althoughnot known for superior working conditions, Basu says Amazon warehouse work might be more appealing to workers who prefer indoor jobs, even at lower pay.

The looming retirement wave

But the retention problem isn't just about those who switch careers. The workforce is aging, and according to an analysis by the National Association of Home Builders, the median age of construction workers has reached 41.

During the pandemic, health and safety concerns led workers across industries to avoid work whenever possible. Federal unemployment assistance made that decision easier.

Basu says others with the same concerns "threw in the towel" and retired. Many older workers who knew they were close to retirement saw the value of assets like homes rise during the pandemic, making the decision to retire easier.

According to Ralph Esposito, president of Suffolk's Northeast and Mid-Atlantic regions, the number of retiring baby boomer construction workers exceeds the number of young people entering the workforce, a major factor in the skilled labor crisis.

Because construction has failed to position itself as an innovative industry where young people can build long-term careers, they have turned elsewhere, viewing it as not the ideal field for their professional growth.

"The reality is that construction can offer tremendous career opportunities for leaders who are tech-savvy, enjoy teamwork, solve complex challenges, leverage cutting-edge technology, and create tangible things that truly change city skylines," Esposito says.

Lack of management training

Basu says one driver for keeping workers on the job is a combination of feeling safe and respected. Unpopular management can lead to retention issues in these areas.

"I think this has become a cliché born of fact," Basu says, "that people don't leave jobs, they leave managers."

As workers switch careers or retire, construction companies need more properly trained workers, so those workers become more valuable on site. This can lead to a catch-22: an unpopular leader, supervisor, or manager whose construction skills are critical to a project may be detrimental to retaining other workers.

However, the problem isn't bad bosses. Turmail says the key is the need for better management training.

"I can't tell you how many people I've talked to who say, 'Yeah, I started with a broom or a shovel, and now I'm managing a thousand people on a billion-dollar job site,'" he says.

Being a good construction worker and being a good leader are not the same skill, and proper training can help new leaders succeed, especially in understanding the behaviors they should exhibit as leaders compared to as workers.

Basu says management issues are certainly a factor, but not always the biggest—it may be more about the labor market and the desire for flexibility. The workforce has shown a strong preference for remote work, which is clearly impossible in construction.

Still, Basu says managers can try to offer more flexibility in hours or expectations to retain workers, even if it's easier said than done.

"If you're a construction manager, you're already struggling with higher input prices, input shortages, and skill shortages, and you have contractual obligations to deliver projects on time," Basu says. "And you're trying to deliver projects within budget for the boss, [which] is very challenging, so even if the workforce might demand flexibility, it's hard to provide."

Not a single cause

The causes of the skilled labor crisis are varied. Cultural, academic, and economic factors have combined to create today's situation. But as Sizemore says, even though the "Help Wanted" sign has been up in the industry for decades, construction continues.

Basu says that as Generation Z enters the workforce, there will be more opportunities to recruit workers who have different expectations and needs from their careers than millennials.

Future articles in this series will focus on attracting Generation Z to construction and on overall worker retention in this uncertain environment.