FMI Warns Craft Labor Shortage May Slow Construction

March 2015

Surveying members of the Construction Personnel Executives Group, FMI reports, “24 percent of respondents will be unable to bid more work and 32 percent will experience slow growth if their companies cannot reasonably meet the need for skilled labor and tradespeople.” Top executives at the largest contract firms in the U.S. took part in the survey.

“Overall, there’s an increase needed in skilled trade workers of more than 10 percent throughout the next three to 10 years,” says Ken Wilson, director for FMI, citing highlights from survey participants. One large construction company says, “Our current hiring forecast shows a need for 8,500 additional craft workers by 2017.”

The top five positions that are expected to be the most difficult to fill are operator (heavy equipment), welder (boilermaker), carpenter, pipefitter and ironworker (reinforcing).

There are two significant contributing factors to the high demand for craft labor:

1. The shift of the construction workforce to oil and gas related construction. FMI estimates that by 2017 nearly 10 percent of the total U.S. construction workforce will be part of this burgeoning segment of the industry.

2. The number of survey respondents that plan to increase the amount of work the company self-performs. Currently, surveyed firms self-perform less than 40 percent of construction projects. However, 65 percent either have plans to or are considering plans to increase self-performed projects.

This in-depth look into recruiting and retention of craft labor includes an analysis of the driving factors behind the skilled labor shortage, the most effective recruitment tactics and how companies are filling the demand for field management of the craft labor force. The report also provides practical counsel on how to develop human resource strategies to improve recruiting and retention rates.