The Labor Shortage That’s Facing The Construction Industry

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The Labor Shortage That’s Facing The Construction Industry

For my first blog series of the year, I’m discussing what I see as the trends that will have the biggest impact on construction in 2016.  To kick off the series, I gave some background on how low energy prices are driving much needed labor back into the construction workforce.

In this 2nd part of the series, we’ll look at what has caused the ongoing labor shortage in the construction industry, and how these energy workers will help the industry greatly in 2016.  If you are interested in new opportunities in electrical construction, sign up HERE for my weekly announcement email.

How Did This Happen?

Many people may wonder how exactly we got into this predicament.  There are a number of factors, but when you boil it all down, here are the main causes:

  1. Over the past decade we’ve experienced a slowdown in immigration to the US
  2. In particular, according to the U.S. Commerce Department, there’s been a 67% decrease in immigration from 2006 to 2013
  3. Foreign workers have not come back to the US after the housing crisis
  4. Increases in opportunity in Mexico coupled with Increases in immigration control and enforcement along the U.S. border means that this workforce may never return

As the economy has started to come back, the demand for skilled labor in construction has continued to increase.  However, there just haven’t been enough quality construction professionals available to meet that demand.  In addition, when energy prices were high and construction workers began to move into that industry after the housing crash, it further exasperated the labor shortage issue for large scale construction projects.   

Biting Off What They Can Chew

In 2015, something unbelievable happened.  Construction companies actually had to turn business away because they didn’t have the manpower to take on large scale projects.  With the world energy market taking a dive in recent months, we’re seeing an influx of skilled tradesmen coming back into the US and that is already having a positive impact on this labor shortage issue..   

In 2016, companies in the construction industry will focus specifically on the biggest projects and the ones that pay the best.  So what does that mean for the skilled tradesman out there?  With these types of projects we’re seeing larger labor budgets, which is leading to better wages for veteran workers and more career advancement opportunities for younger workers.  If you fit into either one of those groups, 2016 promises to be a fruitful year for you!

6% Growth Forecast For The Industry In 2016

If you’ve been watching or reading the news over the past several months, it’s easy to have a negative view of things.  The headlines have been all about the stock market losing value, Federal rate hikes, and China’s ongoing problems.  One thing that has snuck under the radar, though, is the construction boom that’s been taking place in the United States.  

There are a number of reasons that construction is doing so well but this article has some great insights on the various moving parts.  In particular, the non-residential aspect of the industry has seen some of the greatest growth – which is great news for me as most of my clients operate in this space.

In addition to these industry growth projections, the generational shift that’s taking place in the trades is going to continue to benefit the Millennial workforce.   

What’s Next?

In the 3rd post for this series, I’m going to dive into the Green trend that has been building over the last several years within the construction industry.  We will look at how something that started out as a “nice to have” for high end non residential projects is quickly turning into a “must have” on construction projects at every level.

I’ll also highlight some of the product lines and other new technologies that should have an immediate impact in 2016.  


Tyson Conrad


By | 2018-06-14T19:20:39+00:00 January 26th, 2016|Blog|0 Comments