The headlines make it clear that a tight labor market remains the reality for companies across the board, despite wage inflation and other economic pressures. The architecture, engineering, and construction (AEC) industry has been especially hard hit by persistent labor constraints.
As a recent Quire MarketWatch explores, a shortage of skilled labor is one of several challenges today’s AEC firms are grappling with. Combined with stubborn inflation, geopolitical events that create supply chain volatility, and high interest rates that weigh on project profitability, a lack of qualified workers makes it difficult to meet client expectations for high-quality work. Add to that the unprecedented demand for construction projects, and it creates a perfect storm for the AEC industry.
How Did We Get Here?
The statistics on the industry’s labor shortage problem are sobering, as per a survey by the Associated General Contractors of America and Autodesk:
- Some 85% of respondents had open craft positions.
- Of those, 88% are having difficulty filling their open roles.
- Sixty-one percent of these firms said the labor shortage is causing project delays.
While the data paints a grim picture, anyone who runs an AEC firm doesn’t need statistics to know there’s a labor problem. They’re living this dilemma every day, struggling to fill open positions and fulfill project requirements. With experts forecasting no end in sight for construction demand, at least in the short term, the problem isn’t likely to correct soon.
But…how did we get here? And why has the labor supply issue proven so problematic for the AEC industry? A few trends have combined to exacerbate the labor shortage problem for construction and related firms.
- Lingering Effects of the Great Recession. Many years later, the massive slowdown in construction that followed the 2008 financial crisis is still impacting the industry. With the economy slowed to a near-halt, unemployment surged across industries, including construction. Though the economy slowly recovered, the construction industry was cautious in ramping back up to pre-recession levels.
- Pandemic-Related Turnover. The departure of millions of employees from the workforce post-COVID created an unprecedented imbalance between worker supply and demand. Though the reasons employees left the workforce are varied—such as physical and mental health concerns, a desire for higher wages, or the pursuit of personal interests—the fact remains that nearly four years after the start of the pandemic, the turnover instigated by COVID-19 still has lingering effects.
- An Aging Construction Workforce. According to the National Association of Home Builders (NAHB), the average age of construction workers is 42. And the Bureau of Labor Statistics points out that nearly 1 in 5 workers in the construction industry is aged 55 or older. While many responded to the pandemic by retiring, many others are on the cusp, creating a further drain on the talent pool.
- Outdated Practices in the Modern Workplace: The persistence of antiquated methods in various job functions highlights a reluctance to embrace technological advantages. Many industries continue to rely on outdated tools and practices, resisting the transition to more efficient software for running their organizations and delivering value more quickly to customers. Young professionals, accustomed to modern technology, may be discouraged by the prospect of working with outdated tools that hamper efficiency and innovation.
- Greater Emphasis on the College Path. As schools and families have encouraged more young people to choose college over trades, there’s been a decline in skilled labor in the US. Today, a much higher percentage of the working population has a college degree, leaving fewer to pursue skilled trades.
- Increasing Demand for Construction Projects. The Infrastructure Investment and Jobs Act unleashed billions in federal funding for construction-related work, while pent-up demand for housing brought many first-time home buyers into the market. The surge in demand couldn’t have come at a worse time, as the industry was already struggling to meet pre-pandemic levels of demand for commercial and residential projects.
What’s the Solution?
It will take a mix of long-term and short-term approaches to equip AEC firms with the skilled professionals they need to meet high project demand and rising client expectations. No single solution will prove a panacea, but a comprehensive approach can help AEC firms begin to fill open roles and shore up the resources to compete for projects.
AEC firms need strategies that can make an impact today. One way they’re tackling the issue right now is by improving their work environment, making it more attractive for skilled professionals. Though competitive wages and benefits will always be critical, today’s workers want more—including an environment that enables them to do meaningful work. Often, that means eliminating mundane tasks that automation can handle more efficiently.
That’s why many leading AEC firms are implementing technologies that drive greater efficiency, offload routine tasks, and free up skilled professionals to focus on more complex work. Technical report writing and management is one area where these solutions are proving especially valuable for firms that are starting to max out on capacity.
Technical report writing has traditionally been a manual, labor-intensive, inefficient process that wastes resources and hampers the ability to take on more work. Without the right tools, many workers end up bogged down in the minutiae of report writing—wasting their talents, fueling dissatisfaction, and creating bandwidth constraints.
The Quire Technical Report Management™ platform eliminates that problem, providing robust, easy-to-use software that empowers staff to create technical reports much more efficiently—reducing the time spent on report creation by as much as 40%. Many AEC firms use the Quire platform to increase technical report writing throughput, handle more deliverables with less headcount, and create a better work environment for their teams.
Join Our Webinar to Learn More!
Quire experts will delve into this timely topic during our March 20 webinar on Navigating AEC Labor Shortages: Tech-Driven Solution Unveiled. It’s a great chance to gain strategic insights and practical strategies for solving the labor shortage dilemma.