Updates

Studies Express Concern about Shortage of Skilled Trades Workers, Especially for Green Construction

Even as construction industry employment reached a five-year high this year, the Associated General Contractors of America (AGC) reported that two-thirds of contractors are struggling with a shortage of qualified workers, to the extent that one in four firms has passed on projects.

“Many construction industry executives expect the situation to worsen during the coming years,” according to a recent AGC survey, which found that project managers, superintendents and carpenters were the hardest to find, with equipment operators, estimators and general laborers close behind, followed by electricians, plumbers and ironworkers.

AGC’s national data was referenced in a Travelers Insurance white paper that also looked at skilled labor shortages and noted that 74 percent of construction firms are having trouble finding qualified trade workers and 53 percent are having difficulty filling professional positions.

A Continuing Trend
While AGC acknowledged that its survey, which polled subscribers to the organization’s daily construction industry brief and email list, was self-selected and limited in size, the results indicate continuation of a trend identified in a 2012 study by McGraw-Hill Construction (MHC), Construction Industry Workforce Shortages, the first study to focus exclusively on design and construction professionals and trade workers, according to MHC, found that nonresidential construction starts by 2015 would be 73 percent over 2011 levels – a level of growth with “serious implications for the availability of skilled workers.”  (Emphasis added.)

Green Construction Worker Shortage 
The MHC report particularly sounded an alarm about jobs in green construction, as more green projects translate into more green jobs, in turn boosting demand for new skills and training.

“The rise of green jobs in construction has both created and intensified potential shortages,” it said, adding, “This shift in the way buildings are designed and constructed also fundamentally shifts the skills and training needed in the workforce.” The green skills most in demand “included general green experience or specific LEED certification experience. 

Defining Green Projects, Green Jobs
MHC defined a green project as one that is either built to LEED or another recognized green building standard or one that is energy- and water-efficient and addresses improved indoor air quality and/or material resource conservation.

In consultation with the U.S. Green Building Council and other independent experts, MHC also developed construction industry-specific definitions of green jobs. Such a job in building design involves more than 50 percent work on green projects or the design of uniquely green systems on any building. A green job in building construction involves installing a uniquely green system such as solar panels or green roofs and requires different skills to meet green goals, such as using products that require different ventilation techniques or salvaging and reusing building components in new structures.

Steady Rise in Green Jobs, Projects
At the time of its study, MHC said green jobs represented 35 percent of the total construction workforce, a figure that was expected to increase to 45 percent by 2014. Green projects were likely to increase from 31 percent of the commercial construction market to 48 percent by 2015.

Expressed another way, MHC found that 41 percent of construction starts were green in 2011, up from 31 percent in 2010 (a 50 percent increase) and from only 2 percent in 2005. The company expected green construction to continue rising to almost half of all nonresidential building by 2015, “equating to $122 billion in construction activity.”


Skilled Workers Scarce

In the face of higher demand, 86 percent of architects and engineers and 91 percent of contractors were not finding enough skilled green workers. A/E firms were finding senior (32 percent) and mid-level (41 percent) skilled green positions the most difficult to fill, while general contractors were about “evenly split on the challenge of finding green skilled managers (48 percent) and craft workers (43 percent).”

The report added, “As the green market continues to grow, these gaps may become even more serious.”

On a more positive note, MHC noted that transformations in the green building market extend to “the way the work is done, such as the use of more collaborative processes. 

Other findings of the MHC study included:

  • 69 percent of architect, engineer, and contractor (AEC) professionals expect skilled workforce shortages in next three years;
  • 32 percent of AEC were concerned about a shortage of specialty trade contractors by 2014; and
  • 49 percent of general contractors were concerned about finding skilled craft workers by 2017; and
  • 37 percent of architect and engineering firms were concerned about finding experienced workers.

Among AGC’s key findings were the following:

  • Two of three respondents have faced a labor shortage over the past year;
  • Half of respondents said skilled labor availability is the most important factor for the success of their businesses;
  • Three out of four companies are willing to pay more for needed labor skills;
  • Seven in 10 are paying skilled laborers more this year, and 13 percent say the increase is “significant”;
  • Respondents from the South, Midwest and West listed skilled labor as the most important factor affecting their company’s success; and
  • The labor shortages are more pronounced in the South and Midwest than in the Northeast and West 

Recommendations
In light of its findings, MHC recommended that companies in the construction industry “take green seriously” by developing green strategies if they don’t already have them. That would include finding green skilled workers, capitalizing on existing green expertise and internal green experts and emphasizing additional green training. Also recommended were finding ways to connect with the next generation and encouraging employee certification.

MHC said A/E and general contractors should urge experienced employees to stay in the industry, as well as find ways to attract new employees, for example by emphasizing work on green buildings and firms’ use of advanced techniques and focusing on technology and green to engage the next generation. MHC also recommended more green training, more skills training promoting collaboration and use of new technologies and more on-the-job experience.

For its part, AGC urged elected officials to act on recommendations in the association’s Workforce Development Plan that would facilitate establishment of career and technical education and training programs, including encouragement of partnerships between registered apprenticeship programs and community colleges.

EC Los Angeles’s E-Contractor Academy, launched in 2013, was established to tackle this challenge. It specifically is working to help small, minority, women and veteran contractors to compete in this growing, lucrative market.  (See related article on E-Contractor Academy graduate Ryan Tittsworth and his firm RBT, which won a contract award from LA County). 

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