Bud LaRosa

As the construction industry continues to experience a tremendous rebound, both in Greater Boston and across the country, the industry is faced with a significant lack of skilled labor. In order to fill our particular need for construction talent, Tocci has embraced a number of creative tactics to retain, recruit and develop skilled industry professionals.

A growing number of private and public projects are driving the industry’s recovery. For starters, Congress passed a $1.1 trillion budget with $1.6 billion going toward the General Services Administration’s construction account (a 300 percent increase) and the Department of Veterans Affairs doubled its construction budget to $1.2 billion. With projections for ongoing growth in 2016, one of the greatest concerns that could derail the recovery is the lack of skilled labor.

This shortage is occurring at all levels, including field craftsman, engineers, superintendents, project managers and leadership. During the peak in 2006, the industry employed 7.7 million people and subsequently lost 2.3 million jobs during the recession. Today construction employment has not reached the April 2006 peak (there were 6.6 million people employed in the industry as of June 2016), yet the industry is experiencing labor shortages indicating that 1.2 million (about 15 percent) have left the industry and are not coming back.

Some of these industry departures are a direct result of increasingly stricter immigration rules. Close to half of the 1.2 million workers who left the industry are Mexican-born. Many who left and went back to Mexico have found that there is work for them in either Mexico, where they can stay closer to their families, or further south in Central and South America.

Age demographics are also playing a role. In 2006, 18 percent of construction new hires were between the ages of 19-25. In 2013 that rate dropped to 13 percent. The prevailing assumption about this shift is the perception that one must earn a four-year degree to make an adequate living. But, given the massive debt incurred while attending college and dim high skill job prospects, this is more myth than reality. Seventeen million college graduates currently work in fields that do not require a college degree. This trend is likely to continue as there has also been an overall decline in training and apprenticeship programs, from 32,000 in 2003 to 21,000 in 2016.

In addition, 1.1 million construction workers will retire during the next 10 years – most with a significant amount of experience.

According to the Bureau of Labor Statistics, Boston has continued to gain construction labor with a net growth between 2015 and 2016 of 6.7 percent; however, this rate does not keep up with the 31 percent year-over-year increase in construction spending at the end of 2015. Thus far in 2016, construction in Massachusetts continues to outpace total 2015 construction contracts.

Combating The Issue

There are several ways the industry is combating the skilled labor shortage. One is through outreach programs to engage younger people (the largest demographic) and women (about half the U.S. workforce but only 9 percent of the construction workforce) to show them that construction is a viable career path.

Like many contractors, Tocci has developed a strong relationship with Boston-area schools that offer cooperative education placement, including Northeastern University and Wentworth Institute of Technology. Tocci has also developed its own unique coop training program for students interested in taking their cooperative education to the next level. Tocci’s plan works with coop students over the course of their several semesters and places them in a variety of departments. This unique rotational experience offers coop students exposure to the interconnected departments that together successfully create a well-built project.

Retention/development programs are another option. Because many younger workers value self-improvement, many contractors are providing Individual Development Programs to expand employee skillsets. To provide this type of self-improvement, Tocci is currently working on a two-year workforce training program aimed at providing company personnel with formal seminars on effective strategic planning that further emphasizes Tocci’s mission to institute a culture of continuous improvement and learning. Millennials are now the largest generation in the U.S. and for this generation, learning is especially important for retention.

Next Steps

One method of combatting labor shortages in the future is through the use of technology. Construction companies have been slower to adopt new technologies, a position that is anathema to younger employees. Companies embracing technology are quickly realizing that many efficiencies are being derived from tools such as building information modeling, augmented reality, drones and mobile devices, to name a few.

Additionally, implementing LEAN Construction, modeled after the Toyota production system, improves efficiency in preconstruction and construction which is important when labor shortages are an ongoing issue. Prefabrication and modular construction are also viable solutions allowing components of projects to be built in factories with more quality control than traditional construction.

Bud LaRosa is chief business performance officer at Tocci Building Companies.