The Impact of Effective Incentive Programs on the Labour Shortage

The construction industry’s ongoing struggles to meet demand stem from a concerning labor shortage. Learning more about how incentive programs can support your company may make your professional life easier, even in the face of ongoing employment challenges. Incentives can help your team attract skilled workers and achieve greater success in any economic climate.

Current Labour Shortage Challenges

Construction businesses are facing employment challenges for various reasons, and job postings are not an overnight solution. The industry needs to hire almost 454,000 new employees in addition to typical hiring to meet demand. The gap in job availability necessitates long-term strategies that address the multiple reasons why the shortage initially emerged.

Companies are also dealing with higher interest rates on materials. If your team is ready to hire, reduced project scheduling due to budget concerns could also prevent you from addressing your internal labor shortage.

Age-related concerns may also impact your team. A larger number of people are retiring, while fewer young people are entering skilled trades. Experts estimate that less than 3% of young workers consider the construction industry when thinking about their careers. The result is fewer teams with enough people to meet industry demand. You may have felt that if you recently had to give projects longer timelines to accommodate your smaller team.

Benefits of Incentive Programs

Incentive programs can address some of the reasons why people aren’t applying for construction jobs. They provide numerous advantages for companies willing to create and sustain them. Consider integrating one if you’d like to see team results like:

• Retaining more experienced employees by giving them the benefits they need to remain on the job

• Attracting new, younger talent with fresh opportunities that they can’t find with other companies

• Supporting those in management positions so they feel empowered to provide the best incentives and leadership

Creating programs to energize current employees and recruits could help companies long-term. The key is making the right program for your team’s specific challenges.

Potential Programs for Construction Companies

Keep an open mind as you explore incentive program options. They’re customizable to each team’s concerns, so consider some popular designs while reflecting on what would help your company retain the talent it needs to grow.

Apprenticeships That Pay

Young people may not sign up for construction work because they believe college will provide them with long-term financial success. This often results in more student debt and less guaranteed employment than they may have imagined. Your company can become a competitive employer by offering paid apprenticeships to students and prospective employees.

Advertise how your apprentices learn on the job, receive a paycheck and don’t have to go into student debt to start a rewarding career. They may also find a shorter program timeline more appealing. Training curricula can provide apprentices with the necessary experience in just 15 weeks compared to a 4-year degree. Addressing financial and time concerns simultaneously could make your team more appealing to young workers.

Project-Specific Bonus Goals

Some employees retiring from construction positions may leave their jobs because they have no reason to continue working for their employer. Bonus goals address that issue. You could create project-specific opportunities that financially reward individuals for performing at their best. If they exceed safety regulations or timeline goals, they could earn bigger bonuses, depending on how long they’ve been with the company. 

Profit Sharing Opportunities

Some may leave the construction industry because they see their employer making large amounts of revenue off projects that only pay them minimum wage. Providing profit-sharing incentives could help retain individuals who seek more economic opportunities. You can also increase revenue through engagement. Gallup found that employee engagement boosts profitability by 23%, which could help your team address material price increases.

Design pathways for experienced employees to start profit-sharing based on how many years they’ve been with the team or their most recent promotions. People may stay with your team longer if they have a stake in the profits generated from their labor. 

Improve Hiring Challenges with New Programs

Rewards are powerful ways to address some of the issues behind the construction industry’s labor shortage. Think about what affects the people in your region most directly. If they need more economic support or reasons to choose blue-collar work, offering employment incentives specific to those concerns will help your company become a more competitive employer.