Industrialized Construction: Training an Invigorated Workforce

Author: Conor Larkin

Where is all the skilled labor?

The construction industry has been dealing with a general and skilled labor shortage since the Great Recession of 2008. There are a reported 430,000 vacant construction jobs in the U.S. that need to be filled this year to meet the high demand we are seeing in the industry. In addition, the 2021 Q2 Chamber of Commerce Construction Index found that 88% of contractors reported having a moderate to hard time finding skilled labor and 35% of contractors reported turning down work because of a lack of skilled labor.

Fewer young people are pursuing careers in general construction, framing, electrical and plumbing, making skilled labor hard to find and reinforcing the feeling that labor shortages are here to stay. With Biden’s willingness to invest in the sector, the impetus to provide unique solutions to the labor shortage is higher than ever.

Industrialized construction as a workforce solution

Industrialized Construction (IC) is seldom discussed as a workforce solution. But its benefits could be timely and strategically critical. IC is a manufacturing mindset applied to the construction process, and may include prefabrication of all or most elements of the building. An influx of IC will certainly lead to increasingly technical jobs and shift the epicenter of the construction industry from the job site towards a factory environment. A shift towards IC does not mean that automation is the only answer to a shortage of workers; rather IC may offer a unique solution capable of invigorating a workforce and sector that has been stagnant for decades.

The key point is that IC and advanced construction technologies require skilled knowledge of general contracting, mechanical, electrical, and plumbing trades hand in hand with novel software and automated applications. This results in IC offering attractive “up-skilling” benefits for the existing labor force, instilling a more translatable and specialized skill set amongst its participants.

So what does this look like in real life?

Take an IC facility that uses 3D modeling tools. The IC company uses modeling software to create replicas of individual floors, rooms, and smaller components like electrical and plumbing modules for a proposed project. Then, using these 3D models as guides, skilled plumbers, electricians, and carpenters, working in a controlled environment (in more ergonomically friendly positions) can deliver precise prefabricated units to a job site in a “just in time” manner. 

In this example, key “on-the-ground” workers employ more specialized and diverse skill sets involving “more brain power and less manual labor”, resulting in safety and productivity benefits across the industry. In order to deploy the opportunities highlighted here on a larger scale we must focus on strategic and nuanced ways to attract and train the workforce in the first place, such that the rising tide lifts all boats.

Workforce development is not a byproduct of invigorating the construction industry. It is a catalyst.

Developing the construction workforce needed for this new future is a multifaceted, multi-stakeholder, and multi-year endeavor. This should include broader and more accessible workforce education programs through community colleges, vocational programs, apprenticeships, or online accreditation programs; stakeholder engagement with organized labor unions; and the utilization of political and policy levers like American Rescue Plan to increase opportunities for workforce development.

Workforce development must also focus on increasing diversity, equity, and inclusion. Not only is this the right action for society, it also increases the pool for skilled labor, multiplying the number of construction  projects that can be completed. The construction industry workforce is 88% white — ten percent more than the national average across all industries — while women make up 9.1% of the workforce and black Americans account just 6%. A 2018 study by the Illinois Economic Policy Institute found that black construction workers earn 74 cents for every dollar their white counterparts make in states without prevailing wage regulations, and 88 cents in states with prevailing wage laws. Over 40% of respondents to a 2020 Construction Dive survey said they had seen racist graffiti on a jobsite, 38% reported hearing verbal abuse and racial slurs hurled at Hispanic and black employees, and 15% said they had seen nooses or racist objects at work. Creating safe and upwardly-mobile opportunities to more people of color and women, who have been historically excluded, is pivotal to driving lasting change and resiliency in the industry.

Attracting a workforce will require leveraging the unique traits of IC. Work will occur in offsite production facilities, meaning a controlled environment with increased comfort and safety. This can reduce typical labor pool constraints (e.g., a requirement to lift 25 or 50 pounds on a job site) and the risk of injuries. Minimizing these traditional barriers to entry can enable unemployed or underemployed ambitious and motivated laborers to transition into construction. 

There are considerations to the shift in job opportunities through IC that must be addressed. These may include disruptive shifts in work location (by geography and urban– rural shifts), in the demographics of people performing the work, and in accompanying support required (e.g., transportation or childcare). All of these factors must be considered when thinking through how IC can help address the labor shortage. 

Despite these challenges inherent to any broad industry transformation, an IC workforce blueprint may help free the U.S. construction industry from decades of stagnation. The time is now, and the opportunities are huge.