When it comes to recruiting good help, labor shortages can extend event beyond the craft tradespeople. It’s become prevalent across all positions in construction, especially during a period of full employment.
“It’s going to get worse before it gets better,” said Deb Marshall, senior manager of HR Consulting at Wipfli, LLP, who told ABC member HR managers that while compensation is important to employees, there is much more beyond wages that keeps employees around.
Money isn’t everything, but …
Money isn’t everything when it comes to employment, Marshall said. “Money helps. You can get in the game with money, but it doesn’t necessarily win the game for you,” said Marshall.
Marshall said you want to pay competitive wages for your employees because they are your life blood. As wages are raised for entry-level employees, wage compression occurs. Wage compression is when entry level workers begin to receive wages that are higher than your current employees. It impacts all other wages from field superintendents to project management and all the way up the line and must be dealt with.
Understanding the different ways employees evaluate their compensation could help you retain employees:
External equity – Looking at what other organizations to see what they’re paying. Recruiters know market value and beware there’s poaching going on.
Internal equity – Looking at other jobs within their own organizations. People talk, so it’s easy to find out what others are being paid.
Process equity – Can you explain how to determine your own pay structure? There is no perfect pay structure, but do your employees trust you? Explain that the system is not perfect, but you are trying to be equitable.
Individual equity – Looking at others in their organizations doing the same job. Need to explain pay ranges and why there are differences.
You have to be confident in your pay structure, so employees know there is a structure. Construction contractors typically provide good benefit packages for employees and contractors, so they need to play that up to attract and retain workers.
Retention pay
You don’t want people to leave because of pay competition. “I don’t think throwing more money at it is really going to be productive. If we can be the kind of organizations that people want to come to, that is something to be considered.”
Contractors also need to be cognizant of your profit margins. Marshall does not advise contractors getting into the retention pay practice to keep employees once they’ve indicated they are leaving. Chances are that he or she will end up leaving anyway.
A valuable and respectful practice, according to Marshall, is to show sincere concern for employees and their future well-being when they decide to leave. It’s usually a much better tactic than making employees feel bad for leaving. It’s also a great conversation starter to be able to determine what else you could have provided to retain him or her.
Respect matters
Respect is of the utmost importance to your current employees, of course. Many individuals don’t feel valued or respected, according to Marshall. A little recognition goes a long way.
“It’s very important the people know that you care about them. There are a lot of field superintendents who have come up through the ranks that aren’t very good at this. We have to find a way to train them on this,” Marshall said.
Are managers and supervisors saying the right things to employees? Are communications based on respect? Are they promoting a culture of continuous improvement?
Every leader is somewhat responsible for turnover. “You want to look for patterns and remove leaders who are driving workers away.”
Beyond the money
Marshall said there are a number of questions you can ask to determine why someone would work for you? Is it career growth? Technology? An opportunity to make a difference? Is there an ownership opportunity? How about education and training? Is there flexibility, especially for family and time off? Certainly, pay is an important factor, but it’s not everything.
What about your company’s core values? Marshall says your website is absolutely critical for communicating core values. Do you share success stories? Are employees having fun or do you just show employees being rewarded for hard work with more hard work? Is the organization history included? What makes your company special?
Marshall suggests you ask your best employees why they stay with a stay interview. A stay interview is a structured discussion that leaders have with employees to determine why employees stay. It also asks whether they’ve thought about leaving and if so, why? And what are some things the employer or supervisor can do to help keep them there.
There’s so much more to attracting and retaining employees than competitive compensation, which is why Marshall advises against just chasing the numbers. Instead look at what is often more important to your employees.
“We are looking at triggering emotions and capturing hearts and minds,” she said.
