Top 5 Trends Impacting Construction HR Teams
By: Dan Ringen
January 6th, 2025
Construction hiring is in the middle of a major shift away from traditional methods of hiring and moving towards a tech-forward approach. This shift is pushing HR Teams to new strategies and understanding the trends in the industry and what they can do to drive efficiency and support the business is vital. Let's take a look at those trends making an impact and changing the hiring and employee landscape in the construction industry.
Top 5 Trends Impacting Construction HR Teams
- Shrinking Workforce
- HR Team Size and Budgets
- Technology
- Increase In Projects
- Competition and Speed To Hire
Shrinking Workforce
According to ABC (Associated Builders and Contractors), the current workforce shortage in the construction industry is over half a million. We don't expect this to resolve in the upcoming years and so adjusting your strategies to match the current landscape is essential. Things like finding workers where they are, being open to non-traditional ways of sourcing employees, a focus on retaining your current employees and keeping an eye on the next generation of workers to enter the industry and how you can attract them is a must.
ABC Article: Construction Workforce Shortage Tops Half A Million
HR Team Size and Budgets
Construction HR teams are often lean and stretched pretty thin in their roles. HR teams of 1-2 are often tasked with all HR aspects for companies with employee numbers that far exceed the average HR to Employee ratio seen across companies of similar size. According to the Society of Human Resource Management, the average HR to Employee Ratio is 1.7. That means that for every 100 people the company has, the HR team should be 1-2 people, we often see however companies much bigger than that operating with 1-2 HR employees. With the recent increases in material and labor costs, companies will continue to operate on tight margins and so any request to increase headcount in HR to support the team's initiatives will be tough to get approved. Finding alternative ways to drive efficiencies is key and products like Propel People aim to do just that by automating manual portions of the recruiting process to allow HR teams to focus on the things that matter without needing to add headcount.
SHRM Article: How Many HR Staff Members Is Best?
Technology
The evolution of HR technology is gaining steam and the construction industry is growing in the adoption rate of these technologies that have shown success in other industries. HRIS and ATS platforms continue to improve and the development of Recruiting Automation Software (RAS) has taken these platforms and made them even more powerful. Review your current tech stack and ensure that you are getting the most out of your tools and that those tools are built for you. Propel People is RAS combined with an ATS that is designed specifically for the construction industry and aims to help reduce the time you spend in the screening process while driving top talent to your inbox.
Increase In Projects
The construction industry continues to grow despite the shrinking workforce which means your company is able to take on more projects but that demands more employees. This puts HR teams in a tough spot where they are trying to hire more employees in a shrinking workforce. Being able to find quality talent and get them hired will allow your company to take the projects they previously had to turn down.
Competition and Speed To Hire
Finally, as you can imagine, if the amount of projects are increasing but the workforce is shrinking, most construction companies are in heavy competition to attract workers. Whether it's reviewing your benefit structure, adjusting your hiring approach or finding ways to keep your current employees, HR teams need to always be evolving to stay in front of the competition and getting to top talent fast. That includes decreasing the time it takes to hire someone. Everyone wants the next employee and making sure your first in line allows you to do just that. In the past, it's been challenging to reach employees on their schedule in a way that works best for them. Propel People allows for automated text conversations so that your screening process can happen whether your in the office or not, that way you are maintaining the interest with candidates and can get them on the job as soon as possible.
In closing, the hiring landscape in construction is not what it used to be. HR teams need to be constantly adapting their strategies and methodologies to be on top of the trends discussed here and Propel People wants to be a part of your new strategy.