The Great Recession hit a number of industries particularly hard, but construction might have suffered the most. Experts estimate that the recession cut 30 percent of jobs in 2007 and 2008, but as of 2015, construction pay has risen 40 percent. This drastic turnaround has created tremendous demand for construction talent, but the pay growth doesn’t stay consistent across all job titles.
FMI Quarterly released a report that breaks down the pay rate growth based on specific professions within the construction industry. According to FMI, the changes in pay rates reflect changes in the construction industry that go much deeper than mere job availability.
Innovation and Creativity Drive Pay
Based on FMI’s findings, construction professionals are financially rewarded for innovative strategies.
Construction companies depend on innovative and creative thinking to help them stand out in this industry. They are seeking fresh ways to procure new projects and to structure payment terms with clients. Therefore, office managers and business development professionals have seen the highest pay rates overall because they spend most of their time in communication with clients and potential customers.
Quality assurance professionals have also experienced substantial pay growth. The construction industry is highly focused on safety, usability, and sustainability, which might account for this change. QA professionals are involved with every project from its inception to ensure the highest quality of materials, building methods, and project management.
General foreman and equipment manager positions have not fared quite as well. Their pay rates have risen less than 2 percent. These professionals work on job sites and rarely interface with clients.
Lingering Changes From the Recession
During the recession, construction companies were forced to eliminate bonus structures from job descriptions, lay off workers, and freeze salaries. Some of these changes seem to have remained, such as the lack of generous bonuses for workers. According to FMI, bonus pay has decreased significantly across the board, with some professionals taking nearly a 50 percent reduction in bonus pay.
Many businesses have switched to incentive-based bonus structures, which frequently fail if they aren’t executed correctly. When employees do not understand what their bosses expect of them and when standards are not consistent across all channels, workers become disillusioned with their employers and fail to meet their goals.
Additionally, the construction industry now uses fewer project managers and instead pursues other methods of job procurement. FMI identified reverse auctions and other low-bid strategies as the motivation behind this decline.
Switching Gears for Employee Retention
The current talent shortage across all facets of the construction industry suggests that companies must make more attractive job opportunities available. In addition to increasing pay rates and offering a generous bonus structure, construction firms might need to improve intangible benefits, such as schedule flexibility and work environment quality.
When employees are satisfied with their pay and job responsibilities, they stay with their employers. Unhappy workers, however, move from one firm to the next, which creates inconsistencies in output and frustrations between construction firms and their clients.
The construction industry has bounced back from the recession, but some changes are inevitable. If you are interested in filling the talent shortages and working as a contractor, browse our courses by state so you can get your education requirements fulfilled.