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Remodeling Workforce Planning in Construction

How Labor Market Pressures are Impacting the Construction Industry and What to Do for a Stronger Workforce Foundation

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To build the infrastructure of tomorrow, the construction workforce needs to be rebuilt today.

Construction companies are facing a severe shortage of workers in critical skills, including carpenters, electricians, plumbers, heavy equipment operators, and general laborers. This shortage is exacerbated by rising demand for infrastructure and a widening skills gap in emerging technologies. Further, while foreign-born workers have sustained the construction industry for years, over-reliance on this workforce amidst uncertainties in immigration legislation puts the industry at great risk.

Risk Factors

1.98

Occupation Risk Score

The construction industry is the second-most impacted by a retiring workforce: among the top 10 occupations with the highest number of workers age 55+, 1.36 million are laborers and material movers. When examining prime-age entrances and exits of key construction occupations, helper roles are slightly gaining workers, likely due to the reliance on foreign-born workers; however, roles such as construction equipment operators, first-line construction supervisors, and construction and building inspectors have a net loss of prime-age workers, at 21%, 27%, and 42%, respectively. When safety and compliance are of the utmost importance to this industry, the loss of talent in these roles should greatly alarm organizational leaders and prompt urgent action to reengage the prime-age workforce to upskill or reskill new talent.

2.76

Market Risk Score

As cities expand and increase demand for new and renovated structures, it would seem as though the population of prime-age workers available to engage in the construction industry would also see more entrances than exits. However, population growth is not driven by prime-age workers, particularly in centers for construction operations like Seattle, Wash. (-16%); Denver, Colo. (-17%); and Tampa, Fla. (-20%). While rare, areas like Fayetteville, N.C. are closely maintaining its prime-age workforce (-0.05%) and even more rare, areas like Hinesville, Ga. are slightly growing their prime-age workforces (+0.01%). Construction companies will need to take a calculated approach to location strategy in both workforce development and market expansion.

5.00

Industry Risk Score

Amongst a growing population needing houses, commercial buildings, industrial facilities, and civil infrastructure, the construction workforce is diminishing as workers retire, young people—already fewer than previous generations—have not pursued the skilled trades at nearly high enough levels, and the prime-age male workforce, who have historically filled construction roles, are participating less in the workforce due to societal impacts. The construction industry has been sustained by foreign-born workers, who make up 29% of this workforce. An over-reliance on the immigrant population presents risks as geopolitical dynamics become less predictable; additionally, construction only happens on site, so work cannot be offshored, and AI simply cannot do the jobs that are required to be done by hand.

2.25

AI Skills Gap Score

While some of the more advanced construction roles are beginning to see growth in AI and automation skills, none can be considered truly AI-ready. Upskilling roles like construction and building inspectors, especially when seeking a prime-age workforce to carry the torch from retirees, is advantageous to companies who need to augment worker shortages and reinforce safety compliance. Moreover, the vast majority of construction roles—74%—have no exposure to AI or automation skills. In many tasks, AI offers no value to the quality, speed, or volume of completing work, such as stonemasonry or drywall installation, but as it’s vital that employers provide career growth opportunities, exposing workers to automation technologies can create opportunities for innovation as they reach advanced supervisory or compliance roles.

Construction Organizations in the Fortune 1000

In the Workforce Risk Outlook, Lightcast found little correlation between workforce risk exposure and their Fortune 1000 ranking. C-suite leaders must align their workforce strategies with their quadrant position, as opposed to assuming their revenue makes them immune.

High Risk/High Scale to Address: Organizations in this quadrant face significant risk of being disrupted in their industry, but also have the financial resources to reduce their risk if they are proactive. These organizations should reduce risk through programs like apprenticeships, partnering with vocational schools, and automating routine tasks.

High Risk/Lower Scale to Address: Organizations within the riskiest quadrant are lower on the competitive ladder and have less resources to address their incoming risk. These organizations must prioritize operational efficiency, cross-training employees, and adopting modular construction techniques to reduce reliance on specialized labor.

Lower Risk/High Scale to Address: Organizations in this quadrant may not face immediate workforce shortages, but should remain proactive to reduce their risk. Investing in advanced technologies like 3D printing for building materials or AI-driven project management tools can future-proof operations while attracting top talent.

Lower Risk/Lower Scale to Address: Organizations in this quadrant, if they are proactive, have a chance to be the disruptors. Specifically, they can disrupt industry competitors in the High Risk/High Scale quadrant. These organizations should focus on their strengths while maintaining flexibility to pivot if workforce risks increase.

See the Full Fortune 1000 List by Lightcast

Solving Construction Workforce Management

Sourcing Construction Talent Competitively

Since construction happens locally, organizations will need to track population demands around residential, commercial, and municipal demand, as well as repair and home service needs, like HVAC. Construction roles also often vary in compensation structures, so benchmarking against the external market to ensure competitiveness and consistency within local markets is important to attract and retain talent. Job titles and skill profiles often encounter inconsistencies in language—standardizing roles with the right prioritization of skills will aid in more effectively recruiting talent.

How Homebuilders Use Data to Inform Market Expansion

A large homebuilder needed geographic and labor insights to target new construction areas for market expansion. Challenged with sourcing skilled candidates, especially in trade roles, the enterprise needed to improve talent attraction by focusing on a competitive framework for compensation and rewards. By using Talent Analyst to understand candidate pools, job roles, and skills to standardize job postings, the homebuilder enhanced pay transparency, recruited more effectively, and benchmark compensation against local markets to competitively attract workers in the target expansion areas.

Explore Talent Analyst

Strategies to Attract Construction Roles

Workers need to see a clear value proposition for pursuing construction careers, so employers need to demonstrate that it is a fruitful career path, especially in the more physically demanding roles. Mapping skill paths and offering training and apprenticeships to grow employees’ capabilities yields a greater return on investment, both for the employer and employee. Additionally, identifying opportunities to bridge disruptive skill gaps ensures employers won’t incur premium costs for additional recruiting, and demonstrates that employees in any trade can be a part of the technological future.

How Construction Companies are Creating Career Paths

To solve for employee retention, a construction engineering group needed to standardize and map its internal skill inventory. Using Lightcast’s skills data, it was able to leverage Career Pathways data to guide role transitions, and US Job Postings, Skills, and Titles data to enhance skills growth with targeted learning and development opportunities across 4,000 skills. A standardized skill taxonomy and normalized job titles have created a scalable, repeatable process to map careers, automate skills identification, and support agile career development.

Get Started on Your Skills Efforts

Sourcing Construction Talent Competitively

Since construction happens locally, organizations will need to track population demands around residential, commercial, and municipal demand, as well as repair and home service needs, like HVAC. Construction roles also often vary in compensation structures, so benchmarking against the external market to ensure competitiveness and consistency within local markets is important to attract and retain talent. Job titles and skill profiles often encounter inconsistencies in language—standardizing roles with the right prioritization of skills will aid in more effectively recruiting talent.

How Homebuilders Use Data to Inform Market Expansion

A large homebuilder needed geographic and labor insights to target new construction areas for market expansion. Challenged with sourcing skilled candidates, especially in trade roles, the enterprise needed to improve talent attraction by focusing on a competitive framework for compensation and rewards. By using Talent Analyst to understand candidate pools, job roles, and skills to standardize job postings, the homebuilder enhanced pay transparency, recruited more effectively, and benchmark compensation against local markets to competitively attract workers in the target expansion areas.

Explore Talent Analyst

Strategies to Attract Construction Roles

Workers need to see a clear value proposition for pursuing construction careers, so employers need to demonstrate that it is a fruitful career path, especially in the more physically demanding roles. Mapping skill paths and offering training and apprenticeships to grow employees’ capabilities yields a greater return on investment, both for the employer and employee. Additionally, identifying opportunities to bridge disruptive skill gaps ensures employers won’t incur premium costs for additional recruiting, and demonstrates that employees in any trade can be a part of the technological future.

How Construction Companies are Creating Career Paths

To solve for employee retention, a construction engineering group needed to standardize and map its internal skill inventory. Using Lightcast’s skills data, it was able to leverage Career Pathways data to guide role transitions, and US Job Postings, Skills, and Titles data to enhance skills growth with targeted learning and development opportunities across 4,000 skills. A standardized skill taxonomy and normalized job titles have created a scalable, repeatable process to map careers, automate skills identification, and support agile career development.

Get Started on Your Skills Efforts