The talent shortage in the residential construction sector will continue to be a challenge for builders and contractors to meet demand, irrespective of current market conditions. But employers can prevent the shortage from worsening by focusing on employee engagement to retain more of their best people and avoid turnover.
That was one of the key conclusions of the 2021 Homebuilding Workforce Engagement Study, which was released this week. It was conducted jointly by the Building Talent Foundation (BTF) and the Oxford Centre for Employee Engagement (OCFEE), and was sponsored by the Leading Builders of America with additional support from the Home Builders Institute, Harbor Freight Tools for Schools, and many other organizations.
In the face of such a severe and persistent talent shortage, employee turnover is an expensive problem. The cost of losing just one employee can be as high as $15,000 for expenses relating to separation, replacement, training, and lost productivity.
But the actual cost is much more than that, says Branka Minic, CEO of BTF. “Our research showed that the people who are at the greatest retention risk are between the ages of 25 and 44,” she said. Most of these individuals, she added, have been trained and are building their skills, and are positioned to replaced employees who retire. They are the future of the workforce.
“When you lose these mid-career employees, you not only lose people who are good at their jobs, but also people who will train the next generation,” Minic continued. “To ensure the transfer of valuable knowledge, we must work hard to retain our skilled talent.”
That magnifies the importance of retention. Recruiting new people into the industry is important, and BTF is dedicated to helping employers fill their job openings. But recruiting mostly fills entry-level jobs. Employers still need to retain the people they have.
Employee Engagement Helps Retention
The 2021 Homebuilding Workforce Engagement Study examined employee engagement in the homebuilding industry, the factors that affect it, and the role it plays in employee retention. It focused on frontline workers employed at residential construction jobsites.
The study found that engagement played an important part in employees’ decision to stay in or leave their jobs, or even the construction industry itself. Retention factors related to engagement – specifically career advancement, skill development, and the quality of their immediate supervisors’ leadership skills – weighed more heavily than compensation.
“This shows that prioritizing engagement, and providing upskilling, career pathways, and well-trained supervisors, will help companies keep good people,” Minic said. “Engaged employees are also more productive, dedicated and happier. Put simply, companies with an engaged workforce are more successful.”
What Employers Can Do
As a result of this survey, BTF is actively developing several initiatives aimed at helping employers improve employee engagement. These initiatives include raising awareness of this study’s results, providing greater access to training resources, facilitating best practice sharing and peer-to-peer learning, and offering career coaching.
In the immediate term, employers can take steps to improve their employee engagement. These steps include:
Provide leadership training for supervisors
Make sure supervisors understand and support employees’ motivations, and communicate effectively
Allow and encourage employees to take advantage of opportunities for advancement and upskilling
Foster a positive, team-centric atmosphere and culture in which team members are encouraged to learn from each other
Provide time and resources for employees to pursue professional and skill development
For many companies, especially smaller companies that make up the majority of the residential construction industry, this may seem difficult. They may not have the resources or a dedicated human resources department to focus on engagement. Fortunately, there are many training modules, tools, and other resources available online at low or no cost.
For trade employers working tirelessly just to meet demand, focusing on employee engagement may seem like a luxury they cannot afford. But Minic said it will pay off.
“When your people are engaged in their work, they are more productive, dedicated, and reliable,” said Minic. “When they’re engaged they stay. When they’re not engaged, they’re at a high risk of leaving.”
Focusing on employee engagement will benefit employers in the short term and will help the industry as a whole in the long term. As more people are happy and growing in their careers, the building industry will gradually develop a reputation for offering rewarding, viable careers, which will in turn help recruitment of new talent into the sector.
“The time to invest in engagement is now,” Minic concluded. “Our industry is already investing heavily in recruiting and training new talent, and those efforts will be twice as effective once the sector is better at engaging and retaining its workers.”
To read the full results of the 2021 Homebuilding Workforce Engagement Study, download the full report.
