Labor in the construction industry remains a cause for concern. Contractors have voiced their worry over the lack of skilled labor in the industry for the past 6 years, and even with unemployment at a record low of 5.2%, contractors are having difficulty finding skilled talent. All this, coupled with the amount of unfilled jobs in the construction industry at a cycle high, means the industry has challenges to overcome in the coming years.
According to the BLS Job Openings and Labor Turnover Survey or JOLTS, the number of construction industry jobs open for employment increased to 248,000 in March. That’s up over 60,000 from the year before, which had open jobs at 179,000. Meanwhile, the open position rate for the construction sector remained at 2.9% in March, a post-recession high. Construction hiring rate ticked down to 5.1% from 5.4% in 2017. On a positive note, the layoff rate for the industry has fallen and holding at 2.6%.
Why this is happening?
These figures can be attributed to the shortage in skilled labor the industry is seeing. Lack of training for middle-aged workers has led to a shortage of leadership roles. While lack of new, young, hungry workers entering the industry has led to a shortage of entry workers. Employee churn is also very low for the construction industry. Baby boomers who were expected to retire and leave the work force are still working because of increased healthcare costs and social security becoming increasingly less reliable as a retirement fund. Another reason is the decrease in training programs. Historically, construction firms invested heavily in training programs, but has since decreased the funding for new employee training.
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