Many business experts from various academic and professional fields have stated that the competitive battle of the future will be for employees, not customers. When it comes to skilled labor, this may be the understatement of the century. The shortage of labor in the trades has gone from a concern to a problem in the blink of an eye. It is a topic of conversation at every trade show, networking event, and gathering of professionals nationwide. In the next 10 to 15 years, it will become a crisis if companies do nothing about it.
Surveys conducted by the Society of Human Resource Management (SHRM), the Bureau of Labor and Statistics, and Economic Modeling Specialists International (EMSI) over the past several years all reveal very alarming statistics. Over half of the skilled labor workforce in the United States is over the age of 45, with nearly 20% between the ages of 55 and 65. That generation, which consists mainly of the baby boomers, will be leaving the workforce at a rate somewhere between three and five times faster than their millennial replacements will be entering.
Even though the millennials represent a larger percentage of the overall population than any other segment, social influences have placed a greater emphasis on higher education and pursuit of professional (white collar) careers. Couple this with an economic rebound, low unemployment rates, and an education in job security, wage, and benefit awareness by the working class, and you have an employee’s market where demand far outpaces supply and skillset.
For restorers to survive this crisis, the first thing they must do is change their mindsets with regard to how they view human capital. It is hard to believe, in an industry where skilled labor is the single largest direct job cost, that employers would view their workforce as anything less than invaluable. However, many companies still look at technicians and carpenters as easily replaceable. This is evident in the reluctance of owners to do even the simple things to attract and retain talent, such as providing basic benefit packages or training and development opportunities.
I have reviewed many business plans and budgets where the capital investment (tools, vehicles, and equipment) lines are double or even triple that of the training and development lines. Newsflash—if equipment breaks, there are plenty of suppliers standing in line to sell you new stuff. If an employee decides to quit or, worse yet, underperforms and stays, it will easily cost you more than your entire equipment budget.
Beyond the wage and benefits battle, contractors need to make their companies more attractive places to work. This goes far beyond having a presentable and clean office or warehouse. It involves creating an environment and culture that makes people want to work (and stay) there. This involves appealing to the needs and desires of the new generations. Flexible work schedules, extended holiday time, comprehensive health benefits, and structured professional development plans will soon become the norm within the realm of attractive places to work.
One of the greatest attributes of restoration contractors is their ability to creatively adapt to situations that arise. Solving a labor shortage will be no different. The use of part time and seasonal employees is on the rise and will continue. The prevalence of legal immigrant workers is a viable and effective option in many areas. And establishment of strategic partnerships with pooled labor sources will provide employers with different methods for them to reach a prospective and scalable workforce.
Getting the word out will be a key component to these initiatives. Just as most service companies might advertise for new sales opportunities, they will now have to advertise for new employees as well. Those of us in Western Pennsylvania have witnessed the effectiveness of this first hand with the Marcellus Shale and natural gas boom. Advertisements for equipment operators, welders, and laborers have peppered our airwaves and television stations for the past three years. Natural resource companies promising higher wages and sustainable careers have successfully recruited and exhausted a large segment of the labor pool in the area.
This proves the magnitude of the situation as it extends across industries. Not only are contractors competing with each other for painters and carpenters, but they are also competing against employers from other industries who are battling for the same resources. The only long-term solution calls for a promotion of the trades that must start with the contractors. The future tradesmen and restoration technicians of our field can be found in our schools and are just waiting to be discovered.
To capitalize on this opportunity, restorers and contractors need to get organized and get involved. The support and sponsorship of local trade schools is a must in this movement. Donate time by volunteering to be on the board, donate money and materials for hands-on workshops, and donate knowledge by offering to supplement the school’s curriculum with presentations on property damage repair and restoration. Getting to these kids early and often will be the key to building a new generation of skilled labor.
The business, science, and engineering fields have proven this to be an effective recruiting strategy through programs like Junior Achievement and STEM (Science, Technology, Engineering, and Math). With a little corporate support from trade manufacturers and the empathetic ear of local legislators, both private and government funding should be available to aid in the effort.
All of this points to a proactive position that should be taken by the cleaning, restoration, and construction industries to help solve this dilemma. After talking to contractors daily about the struggles of filling voids in their labor forces, I have no doubt this could be the single largest struggle facing the industry in next 10 to 15 years. Sitting idly on the sidelines is not an option. Restorers must accept the facts and statistics of the social and demographic shifts that we knew were coming and act swiftly to promote the future of our trade.