The Construction Industry’s Top 3 Workforce Pain Points (and their Solutions)

October 5, 2021 - minute read

Like many business sectors, the construction industry continues to experience ups and downs. According to Associated Builders and Contractors (ABC), a trade association that tracks key industry indicators, while business is looking up overall, contractors continue to face significant challenges.

In its most recent economic update, ABC reported that its Construction Backlog Indicator, which reflects the amount of work expected to be performed in the months ahead, has dropped since July. In addition, its Construction Confidence Index is falling.

While contractors retain a (mildly) positive outlook, higher labor and supply costs, paired with declining project activity, continue to limit the industry’s recovery.

It’s important to keep in mind that, while there are some pain points contractors can’t resolve (i.e., supply chain gridlock, rising material costs), there are others that they can control—specifically, factors related to their workforce.

And when it comes to better managing the workforce, great HR software is one of the most powerful tools at any employer’s disposal. So, what are the industry’s most pressing workforce pain points—and how can the right HR software help overcome them?

#1 Construction Pain Point: Ongoing Safety Risks

Worker safety continues to plague the construction industry, which consistently leads all sectors in workforce fatalities. According to OSHA, 1,061 construction workers died in on-the-job accidents in 2019—making up 20% of all work-related deaths.  

In fact, of the 10 most frequently cited OSHA violations, three are specific to construction: fall protection, scaffolding requirements and ladder safety. According to the National Safety Council, construction workers ages between 25-34 are most likely to be injured on the job.

Without question, rigorous, ongoing workforce training is the number one way to keep construction workers safe. Fortunately, contemporary online learning management systems—offered in conjunction with many HR software platforms—make it easy to provide workers with virtual training classes at any time, in any environment.

For example, EPAY’s e-learning solution offers vetted, up-to-date safety courses, pre-formatted exams and certifications, and analytical and reporting tools for tracking workforce progress, as well as documenting OSHA compliance.

#2 Construction Pain Point: The Labor Shortage

Ask any contractor what’s keeping him or her up at night, and they’re likely to say: a shortage of skilled labor. While this is not news, it is indeed painful—extending project timelines, lowering customer satisfaction and depressing profits.

As more Baby Boomers retire, construction workers are aging out at a faster rate than younger workers are opting in. According to the Bureau of Labor Statistics, overall employment in the construction industry is projected to grow seven percent between 2020 and 2030 (about average for all occupations). However, the BLS also projects a shortfall of nearly 168,000 workers per year in the construction sector.

One quality that younger workers look for in potential employers: their embrace of new business technologies. Contractors that use cutting-edge applicant tracking software—say, those that allow candidates to complete job applications by smartphone and communicate with employers by text—have an advantage over those that do not.

EPAY’s applicant tracking software not only allows employers to post to multiple job boards in a single click, but supports a mobile application process. It also allows employers to quickly screen applicants for needed skills and—in conjunction with our HR hiring analytics—identify the source of their best (and worst) new hires, allowing them to continually refine their hiring process.

#3 Construction Pain Point: Labor Budget Constraints

Labor costs have always presented a significant challenge for contractors—even when supply costs aren’t on the increase. In Marcom’s most recent PAS Contractor Compensation Quarterly report, the accounting expert warns contractors to overcome “sticker shock” and pay the competitive salaries required to hire and retain the most skilled workers.

Now more than ever, tracking labor spend across various job sites is critical to keeping project costs under control. Not all contractors may be aware that some HR software platforms will perform this function in conjunction with its time and labor system.

For example, employers who use EPAY’s labor budgeting and job costing module can see how their labor dollars are being spent in real time, tracking labor expenses and job costs by site location, department, client and/or task.

This allows contractors to make more informed decisions, tweak labor budgets as needed and forecast expenses going forward. In short, it allows employers to close the gap between estimated labor budgets and actual costs, eliminating waste and unwelcome surprises.  

While it’s true that the construction industry is not always the first to adopt new technologies, many contractors now find themselves at an inflection point. The right HR software can ease the most pressing workforce pain points, while helping them operate more efficiently and pro-actively.

EPAY Systems, a PrismHR company, was designed for employers that manage an hourly, distributed workforce, like contractors. There’s a reason we’re the leading choice in these markets—see what makes us different.

Filed Under: Construction