Construction Labor Shortage Trends
The construction labor market in the U.S. has been tightening for decades.1 At the end of 2021, the U.S. Chamber Commercial Construction Index stated that 62% of contractors reported “high difficulty” finding skilled workers, and 56% of contractors reported a “high degree of concern” about their workers having adequate skill levels.2
Additionally, many skilled workers are nearing retirement, which is contributing to the labor shortage. Currently, the median age of construction workers in the U.S. is 41 years.3 Companies feel pressure to invest in younger employees.4 However, a survey of over 29,000 high school and college students concluded that approximately 17% of individuals entering the work force are interested in construction.5
In response to the labor shortages, contractors turn to construction technologies in an effort to increase the current workforces’ efficiency and productivity.6 For example, a recent Deloitte survey indicates 43% of engineering and construction executives plan to invest in new design processes in the next year in an effort to improve labor efficiency and productivity.7 The new design processes, known broadly as industrialized construction, include prefabrication and modular construction, among others.8 Industrialized construction uses technology and advanced manufacturing methods to automate the creation of building components, meaning there is less to build on site and thus less labor is required.9
Many of Breakwater’s clients feel the impacts of the tightening labor market. Breakwater has skilled professionals who are experienced in analyzing construction disputes related to labor issues.
1: “Construction’s career crisis: A look at the industry’s labor shortage” by Zachary Phillips, dated October 27, 2021.
2: U.S. Chamber Commercial Construction Index – Q4 2021, dated December 15, 2021.
3: “Median age of construction workers is contributing factor to workforce shortages” by Sebastian Obando, dated July 9, 2021.
4: “Construction’s career crisis: Recruiters target young workers driving the Great Resignation” by Ryan Golden, dated October 25, 2021.
5: “Tallo Data Insights: Where does Gen Z Want to Work?”, dated April 6, 2021.
6: “2022 engineering and construction industry outlook” by Deloitte.
7: “2022 engineering and construction industry outlook” by Deloitte.
8: “3 solutions to help with labor stability and supply chain certainty in a challenged construction environment” by DIRTT, dated February 14, 2022.
9: “3 solutions to help with labor stability and supply chain certainty in a challenged construction environment” by DIRTT, dated February 14, 2022.
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