‘Transient’ construction labour force slows growth potential: Study

Most Canadian construction employers expect to grow their business in 2015 but less than half will boost permanent head count, according to the fifth annual Hays Canada Salary Guide.

At the same time, construction firms struggle with uncertainty around worker availability as hiring for short-term, project-to-project contracts results in a state of employee transience, notes the report that was released this morning.

Overall, the Hays report suggests that while some construction employers increasingly rely on internal training to fill short-term talent gaps, hitting business targets in 2015 and beyond could be undermined if competitive retention strategies aren’t found.

The survey, conducted in November 2014, found that 73 per cent of Canadian construction companies anticipate increasing business activity in the coming months, a jump of 18 per cent jump over 2014. However, permanent staff levels will likely remain static putting pressure on current employees.

Many respondents also admit that hiring tends to be ad hoc and for short-term positions that don’t offer career growth or stability.

As a result, employees frequently relocate to new projects rather than focus on building careers and the lack of professional development contributes to the shortage of talent experienced by almost 80 per cent of construction firms. The inability to find qualified construction help could undercut the ability to complete projects on time or commit to future ones.

“Looking at the results this year, we have to ask ourselves whether construction firms’ focus on short-term hiring threatens long-term potential,” said Rowan O’Grady, President Hays Canada. “Adding to this concern is the fact that relatively few respondents run professional development programs and admit it’s the main reason for the skills shortage in their industry,” O’Grady added.

“Construction employers should be investing in skills development, recruitment and succession planning to keep pace with their current and future ambitions.”  

Skills shortage is employer issue  

Employers in the construction industry admit that many of the factors that impact the talent issue are within their control. While 64 per cent of respondents say that competitive salary packages are how their company attracts and retains top talent, promoting competitive benefits and company culture are also considered enticements for savvy candidates.

Thirty-four per cent of respondents also acknowledge that fewer people are entering the construction industry. This mirrors attitudes across all sectors as well as general opinions that employers have a responsibility to boost numbers of qualified graduates by promoting themselves and their industries at the post-secondary level.

“Employers understand they have a role in facing these issues head-on and Hays recognizes that doing so falls outside their areas of expertise,” added O’Grady. “Companies need help and we can bridge this knowledge gap to support them as they invest in staff retention and recruitment plans, along with future-proofing their company.”

Positive signs

Despite unpredictable markets worldwide, responses from Canada’s construction employers show that the majority (80 per cent) of employers plan to offer some form of salary increase in 2015 and more than half (53 per cent) believe that the country’s economy will continue to strengthen throughout the next 6-12 months. This level of optimism is in lock-step with national averages, which are at their highest point in five years and signifies a 15 point jump from its lowest levels in 2011.

“It appears Canadian employers are poised to capitalize on their positive outlook although I sincerely hope a focus on short-term gain doesn’t distract them from resolving the looming challenges ahead,” said O’Grady.

Additional cross-industry highlights

• More than 50 per cent  of employers believe their company’s reputation and low profile are barriers to recruitment.
• 70 per cent say recruiting for senior roles is the most difficult and can take anywhere from 2-6 months to fill
• 82 per cent of employers say they made the wrong hire likely due to desperation and a lack of time

Hays Specialist Recruitment Canada is a wholly owned subsidiary of Hays plc, which has been at the forefront of the global recruitment industry for over thirty-five years. With annual revenues of over £2.1 billion, Hays Specialist Recruitment is the largest specialist recruitment consultancy in the world.