Chapter Corner

Four Elements of Workforce Development

Posted in: Features, January/February 2015

four-elements-revised.gifOver the next five years, and particularly along the U.S. Gulf Coast, the demand for skilled industrial construction craft professionals is expected to exceed the current supply by a significant margin. In states like Louisiana, major public-private partnerships have been created to determine the extent of the demand/supply deficit and develop programs to address career awareness and recruiting, training capacity, craft professional retention, and training program delivery. Industrial construction associations and individual contractors are engaged in the Louisiana efforts and similar efforts across the United States.

We encourage our clients to develop a comprehensive and systematic approach to developing a workforce that is adequate in numbers and skill level. Doing so requires attention to four specific elements:

1. Forecasting

  • Accurately forecasting demand for specifically skilled workers
  • Accurately forecasting supply of specifically skilled workers
  • Developing a clear picture of the delta between the two

2. Career Awareness and Recruiting

  • General career awareness specific to create interest
  • Targeted recruiting based on specific forecast

3. Training

  • Training in rigorous, accredited, industry-based certificate-bearing programs
  • Skill upgrade programs for incumbent workers

4. Employing

  • Systematic process to move individuals directly from training to careers

 

1. Forecasting

A number of tools exist to assist industries in forecasting the demand and existing supply of workers. In the construction industry, the state-of-the-art tool is the Construction Users Roundtable (CURT) Construction Labor Market Analyzer® (CLMA®). The CLMA is a powerful, easy-to-use tool that produces actionable, real-time craft labor market intelligence for any area of the United States. It enables current and early project workforce planning in a new and unique way so that you can more effectively manage your project labor risk.

So what’s different? Before, craft labor outlook data was questionable and expensive. Now the CLMA provides instant labor market clarity enabling detailed project and human resource planning at reasonable cost. The CLMA allows for granularity in forecasting down to the zip code level.

For instance, it can provide information on the supply of pipefitters in a particular region and the upcoming demand in that region. Recruiting and training plans can then be targeted and specific based on the accurate forecast.

As the national economy rebounds and low natural gas prices drive an unprecedented level of investment announcements in the petrochemical industry along the Gulf Coast, the CLMA predicts that as many as 2 million new workers will be needed to meet demand over the next three to five years. 

2. Career Awareness and Recruiting

Career awareness programs are becoming more critical. As competition increases for the shrinking under-25-year-olddemographic, every industry, from construction to aerospace, must differentiate itself in order to recruit new workers. Career paths are critical tools to clearly explain the options and career growth opportunities each industry can provide.

Several industry groups and associations, including IEC, are increasing efforts to recruit and train the next generation of craft professionals. This includes reaching students in secondary schools and job training programs. These construction industry groups aim to narrow the skills gap through awareness of careers in trades, increased access to training programs, and opportunities for second careers or veterans in the trades.

The goals are:

  • Make career and technical education a priority in secondary schools
  • Shift the public's negative perception about careers in the construction industry to reflect the wide range of professions available
  • Provide a path from ambition, to training, to job placement as a craft professional.

3. Training

Once the forecast has been done, the difference between supply and demand is known and career awareness and recruiting are underway, the most critical element of a comprehensive workforce development program begins. Training should always be based on industry developed and accepted standards. It should be provided through rigorous and accredited programs that lead to industry-based certifications.

Training of newly recruited individuals is critical but is not the complete answer to meeting the demand for skilled craft professionals in the construction industry. While recruiting new workers is critical, upgrading the skills of the existing workforce must be part of any workforce development strategy. For example, the State of Louisiana has a baseline of about 100,000 construction craft professionals. Based on the current level of announced investment, the state believes that it must recruit and train as many as 85,000 new workers. A focus on skill upgrade programs for the existing workforce can play a critical role. In 2007, the Construction Industry Institute conducted an in-depth study of construction craft training. The results of the study indicated that, on any standard industrial construction or maintenance project, an investment in craft training of only 1 percent of the total labor costs of the project could yield the following average improvements:

ITEM                      CONSTRUCTION                    MAINTENANCE

Productivity            11%                                     10%_______

Turnover Cost         14%                                     14%_______

Absenteeism_____ 15%                                     15%_______

Safety/Injury_____26%                                      27%_______

Rework_________ 23%                                      26%              

 

SOURCE: Construction Industry Institute (CII).RT231-1 “Construction Industry Craft Training in the United States & Canada” (Aug 2007)

If skill upgrade training could yield productivity improvements of 10 percent, this could serve to reduce the number of new workers that are needed and must be recruited. The existing workforce has already chosen to be in the industry and no recruiting resources need be spent on these craft professionals.

The “Training” element programs must include both entry-level training of newly recruited workers and the skill upgrade training of the existing workforce.

4. Employing

The “Employing” element is critical. No longer is it acceptable for us to recruit and train new workers and then “wish them luck” in finding employment and launching their careers. Too many newly trained individuals struggle to catch on with construction companies and become frustrated, eventually leaving the industry before ever getting their career started. This is a loss of workforce supply, a loss of training investment, and a negative to the industry image. An integral element of an effective workforce development program is a systematic process to move individuals directly from training to careers. The details of the systematic process may vary from company to company and organization to organization but general elements of the process include:

  • Case management/Placement
  • On-boarding assistance
  • Mentoring
  • Follow up

A comprehensive workforce development program is more than just training. In order to compete for the hearts, minds, and talents of the next generation of workers, a program must include forecasting, career awareness and recruiting, training, and employing.

As the story goes, a young construction company executive said to an old construction company executive, “Why do we invest in training people? What if we train them and they leave us?” The old construction company executive responded, “Young man, what if we don’t train them and they stay?”

Tim Johnson is President of the TJC Group, a Baton Rouge, Louisiana-based consulting firm specializing in workforce development, public affairs, governmental relations, and business association management. He can be reached at tim.johnson@thetjcgroup.com.