HR Tips for Contractors: Employee Retention for Contractors Paramount Amidst Labor Shortage

ContractorsPersonnel Management

02/17/2021 | By Carla Sarabia

The labor shortage for builders is well documented, with some research suggesting as much as 80% of construction companies reporting not being able to find enough skilled workers. While statistics like that tend to grab the headlines, the more important part of the story for contractors is how significant that makes employee retention and development planning for owners and managers. 

Creating systems and processes designed for keeping your employees can reduce the challenges of hiring by reducing unnecessary backfilling for positions and generating higher output and performance out of existing staff. 

There are many reasons why people leave companies. However, people are more likely to stay with companies where they believe they have a promising future and a voice for the direction of their career. Contractors should strive to create processes and a culture where employees feel comfortable talking about their careers and the company. 

Make compensation plans consistent and transparent

In addition to employment agreements, having a document that normalizes compensation structure and perks is helpful to creating transparency with staff. 

Start with a clearly defined job description for each team member so the right candidates will easily recognize that it’s a good fit for them. Then offer competitive pay and benefits, a safe and appealing working environment, bonuses or incentives, and ongoing training and development.

Desirable benefits may include paid time off, health insurance, retirement contributions, and less traditional benefits like gym membership that may help your compensation package stand out. Remember, skilled construction workers are in demand, and they will shop around.

Hourly wage or salary considerations should be standardized where possible based on seniority and job description, with variables in staff compensation based on performance incentives. Successful contractors are ones who make clear their willingness to invest in their staff through improved compensation based on improved performance- which in turns helps support culture and company performance. 

Benefits and company perks such as expense reimbursements should also be normalized throughout companies. Since construction work is labor intensive, it is important to emphasize the value of healthcare. Make sure employees understand their health benefits and encourage workers to never ignore signs of injury or illness. Furthermore, explain to your workers why they should make frequent use of their healthcare benefits and how to get the most value from their coverage. For example, your policy may pay for preventive checkups or provide rewards for quitting smoking or losing excess weight.

Establish clear and open structure for communications

Opening communication around issues in the workplace and an environment that offers workers a voice helps managers prevent potential problems and address existing issues before they worsen.

Standardized or regular meetings and check-ins with each employee is a meaningful way to build relationships, learn about work experience and address their concerns or questions. Establish channels of communication where employees can voice concerns without repercussions, such as all-hands meetings or a “suggestion box.” The suggestion box can be a physical place to collect notes, or a digital tool like a generic “suggestions@” email address. 

Whatever the format, make sure to consider language barriers and where possible have bilingual staff available to support meetings and communications. 

Training and Development

Statistics show that new-hire construction workers have more frequent work-related injuries than any other type of employee. HR professionals should make sure that onboarding new employees includes thorough job training with an appropriate emphasis on safety. New hires should learn to recognize job site hazards and be prepared for all types of risks they may encounter.

Helping new hires succeed means onboarding doesn’t begin and end on their first day. Have regular check-ins at least once a month for the first six months, which can help you ensure that employees continue to have the appropriate training and equipment to do their work safely and efficiently.

Training should begin on a new hire’s first day, and then continue to be an evolving element of a worker’s career as long as they are part of your team. Today’s workers want career development opportunities that not only increase their skills in their current job but help them explore different career paths, broaden their skill set, and qualify for promotions. For employers, a sound training policy can help reduce their skills gap, improve risk management, and increase retention.

Mentorship structures and programs

A mentorship program can be a great tool for retaining construction employees. Veteran employees can share their knowledge by taking new hires under their wing and teaching them on the job. This helps new employees become familiar with the construction site and company culture, fosters friendships between employees, and ensures that valuable knowledge is passed from one employee to another while meeting the new hire’s desire for development. All of these benefits can help new hires see that your firm is a good place.

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