Construction Labor Shortage Statistics

At ConstructionJobs.com, it is our goal to keep the construction industry up to date on relevant issues and trends. To that end, we've partnered with Procore to provide a brief overview of some statistics that will have an impact on the industry throughout 2020. Below, Procore offers a summary of a recent study of construction labor shortage statistics. We hope you find this data to be valuable!

Many Construction Firms Planning to Add Staff

Four out of five construction firms (which is 79%) had planned to have the headcount increased in 2019 from 2018's 75% of respondents. Half of the firms (49%) had reported that the expansion will only boost the size of their firms by 10% or even less than that.

About one-fifth of the firms said that the headcount would go up from 11 to 25%, whereas 7% of them had planned to have employment increased by more than 25%. Only 2% of them planned on decreasing their headcount, which meant that construction employment would go up considerably in the following year.

Every type of firm had reportedly planned to increase employees, with the largest companies reported to have the most bullish expansion plans in place. Among those firms with a revenue of more than $500 million, 87% of them reporting plans to increase their headcount in 2019.

Among midsize firms with revenue being somewhere between $50.1 million and $500 million, 83% had planned to expand their employee base. And among firms with a revenue of $50 million or less, 75% were planning to include more workers in 2019.

Three-Fourths of Firms Struggling with Workforce Shortages

On January 2, 2019, the Associated General Contractors of America (AGC) and Sage conducted a survey in which it was reported that the construction industry is experiencing a skilled labor shortage in construction.

About 78% of the construction firms claim to be having a hard time filling in hourly craft and salaried positions. The share was a bit down from 2018's 83%.

Furthermore, for at least 42% of the firms, it will be hard to hire personnel in the next 12 months, whereas for 26% of them, it will become even harder to hire more personnel in the next 12 months. Reducing input costs is another way to prevent construction labor shortage. Learn more about that on Procore.

So far, when firms were asked which of the 16 issues was the biggest concern for them, 30% of them answered the construction industry labor shortage. This was more than what 10% of them chose, which was "increased competition for projects."

However, employers weren't really worried about the safety and health of their employees when asked about them, though 43% of them said that the most recurring challenge for them is inexperienced workers. Furthermore, 16% of the respondents reportedly see subcontractor health and safety performance as a challenge. Another challenge, according to 14% of firms, was a lack of cooperation from regulators or government agencies.

Challenges in staffing are affecting both completion times and project costs. A third of the survey respondents (33%) claim that costs were higher than anticipated. Likewise, 34% reported that products are taking longer than expected and that 18% had contributed greater completion times in the contracts or bids.

Firms Looking to Raise Pay and Invest in Training

Firms will continue to increase pay and offer benefits and bonuses so that the construction skilled labor shortage can be addressed. 59% of those firms reportedly had base pay rates increased. 29% of them offered bonuses and/or incentives. 21% of them improved employee benefits or contributions to lessen the burden of workforce shortages.

Apart from including more compensation packages, most firms are also going to invest in training programs to train both current as well as potential new employees. 63% of the firms reportedly plan to invest more in development and training in 2019, which is more than the 52% of those who planned on doing so last year.

Larger firms are likely expected to do more: 71% of firms with revenues of more than $500 million claim to provide more investment for training, compared to 66% of midsize firms as well as 59% of firms with revenue between $50 million and $500 million.

Contractors Still Looking to Embrace Innovation

Firms are looking to replace employees or hire those with less training by adopting several new approaches. About 32% of firms set their planning to use methods in which on-site work time is reduced, including off-site fabrication, reconstruction, BIM, or other techniques of virtual construction. 20% of firms are now looking to invest in labor-saving equipment, such as robots, drones, GPS- or laser-guided equipment, and 3D printers.

18% of firms are set to add specialists such as BIM or lean construction personnel, architects, IT or data personnel, or drone or other types of equipment operators. 41% of firms make use of lean construction principles in their operations and/or projects, with 20% of them expecting a boost in their company's operations involving BIM.

Most firms reportedly follow methods of collaborative project delivery. 44% of those firms reportedly work on projects of design-build whereas 26% of them work on projects of design-assist. Most of the firms (51%) reportedly collaborate with partners using file-sharing sites like Dropbox, 36% use online project collaboration software, and 22% use BIM.

The need for job site mobile capabilities continues to be the biggest contributor to cloud-based technology usage. The big ways in which contractors plan on using mobile software are for daily field reports (44% of firms), accessing job and customer information from fields (40%), employee approval and time tracking (40%), as well as sharing photos, documents, and drawings (30%). These percentages are higher than they were last year. Only 3% of those firms have no plans on using mobile technology software, which is a drop from last year's 5%.