In the skilled trades industry and across all employment types, the great resignation is a term that is being used to describe the loss of vital talent. As America experiences a mass exodus of skilled workers, construction projects are being left with a major skills gap. However, there are ways that construction companies can benefit from the great resignation. In this article, we will discuss four ways that your skilled trades hiring can actually benefit from the great resignation!
Leveraging the Great Resignation in Your Next Construction Project
What is The Great Resignation?
The term "The Great Resignation" has been used to describe the mass exodus of skilled workers from industries, including those in the United States. This is not a new phenomenon, as it has been happening for decades. However, in the past few years, there have been some significant changes that have led to an increase in the number of skilled workers leaving their homes.
Some of the reasons for the great resignation include:
- The high cost of living
- Poor work/life balance
- Lack of job security
- High demand for talent
- Limited career prospects
What does this mean for the skilled trades industry?
In the midst of an aging workforce and a lack of young tradesmen, having skilled workers leave for better opportunities compounds the labor shortage. The realities of traveling work can add to the pressures that push people off the job, or entice them off your job. Whether they are traveling or local, the pressures of inflation are eating into what skilled trades workers are taking home.
More than ever, workers across the board have a strong sense that they ought to be respected and well-paid. And if they perceive that this is not happening where they are, they may start looking for something better. A Pew Poll from 2021 cites 63% of workers who say they quit because of a lack of respect.
The great resignation is affecting the construction industry in many ways, including:
- The number of skilled workers available for construction projects will decrease
- The cost of construction projects will increase due to labor costs
- Projects will take longer to complete
- Quality of work may decline if less skilled workers are employed
- Jobs are taking longer to fill
However, there are still ways that companies can leverage the great resignation to keep their crews fully staffed.
Leveraging the Great Resignation in Your Next Construction Project
1. Paying Better Will Curb Inflation (and Help Them Feel Valued!)
In the United States, the skilled trades industry has been struggling for years to find qualified workers. A survey conducted by the US Bureau of Labor Statistics found that the number one reason people leave their jobs is because they feel undervalued and unappreciated at work.
Paying skilled tradesmen competitive wages will not only curb inflation but also help them feel valued. When skilled workers feel appreciated and their skills are in high demand, they are less likely to resign.
Many construction employers are forced into higher pay simply to fill the slots to get projects done, or have open positions languish in job boards while local project managers add lack of talent to their list of frustrations. It's critical to understand the trends and forecasting this can help you to have an advantage as you hire. A good staffing partner can help with effective planning.
2. You Can Use an HRM or Other Technologies to Hire Talent
Understanding the new psychology of workers requires a serious look at the human resource environment. Simply doing what you've always done, probably isn't going to fill your crews and keep them filled. While safety training is one part of an effective skilled trades approach to managing human resources, a deeper understanding of the nuances of why people apply, hire on, and stay requires the skills of human resource experts.
Now more than ever, construction companies need the skills found in the practice of Human Resource Management (HRM) to retain the right talent. Whether these skills are found in your internal staff or delivered by the staffing agency partner, it is now a critical part of success in skilled trades employment.
'Note: Ask staffing partners about their capacity to deliver HR consulting that goes beyond simply addressing the requirements of vetting and payroll.
Construction is not alone, because the great resignation is not only affecting the skilled trades industry, but also other industries such as manufacturing and healthcare. As more workers leave, it becomes harder for employers to find qualified candidates who are willing to stay put. And the attitudes and expectations of employees aren't confined to just one type of employee—attitudes about work spread across traditional boundaries.
On the hiring side, an important way to combat the labor shortage is to build a deeper hiring bench. This means that you should not only focus on finding candidates for the current job opening, but also on future openings. Look for staffing agencies that specialize in anticipating future needs, not just filling current roles with quick hires. Staffing partners should be more than just the last resource, but should be involved in planning the entire project manpower curve.
3. This is The Time to Look into an R&D Tax Credit
What is the R&D Tax Credit?
The Research and Development (R&D) Tax Credit is a tax incentive that allows businesses to recover some of the costs associated with developing new or improved products or processes. The credit can be used to offset income taxes, payroll taxes, or alternative minimum taxes.
In order to qualify for the R&D Tax Credit, your company must meet certain requirements. These include :
- The development of a new or improved product or process
- The purpose of the research must be to improve the function, performance, reliability, or quality of a product or process
- The research must be conducted in anticipation of commercial production
Since there is a technological focus to this credit, companies that employ skilled trades that are working with technology are more likely to qualify. Activity around alternative energy and computerized fabrication, along with work in automation controls may be a fit. If your company meets these requirements, you may be able to claim the R&D Tax Credit.
4. Get Your Existing Employees Training and Time-Off, plus Think Career Development
In order to maintain your workforce, it is essential that you provide your employees with the training and time-off they need. In the United States, the average worker changes jobs every four years. However, the average tradesman stays at his job for ten years. The reason for this is that many skilled tradesmen have a passion for their work and enjoy the challenge of the work they do.
In many instances journeyman have continuing education requirements and helping them make continuing education opportunities part of the job provides an added benefit. Training and certification opportunities and partnerships with organizations like local community colleges and Associated Builders and Contractors can help connect your business with younger skilled tradespeople, but may also provide opportunities to keep your more seasoned tradesmen engaged.
Career development has not always been part of the thinking when it comes to hiring in the skilled trades, but especially for younger workers, it has to become part of how work is viewed.
What is the Workforce Training Credit?
The Workforce Training Credit is a tax credit that allows businesses to receive up to $250,000 in tax credits per year for employee training.
In order to qualify for the Workforce Training Credit, your company must meet certain requirements. These include :
- The training must be for employees who are not in management or executive roles
- The training must improve the skills of the employee
- The training must be related to the employee's job duties
If your company meets these requirements, you may be able to claim the Workforce Training Credit. Depending on the size of your business, and the level of participation in your state this tax credit may or may not be available or useful, but thinking and planning about how to upgrade and invest in skilled tradespeople will be meaningful to them.
Hiring for Tomorrow
We hope these tips will help you keep your skilled workers around for the long haul. If you have any questions about how to put these ideas into practice, please reach out.
And finally, we want to remind you that The Great Resignation can work in your favor—so make sure you show your employees they are valued by appropriate levels of pay, using HRM to invest in talent, taking advantage of the R&D Tax Credit and training partnerships, and the opportunity to be involved in employee development programs. Partnering with a staffing agency is one of the best ways to anticipate workforce curves and find and keep better tradesmen. Let us help you get started!