As the construction industry recovers from the stagnant wages, right-sizing and reduced volume and margins caused by the economic downturn of 2008, a new challenge is emerging. Many workers left the industry and moved into other areas of work. The result is a growing shortage of skilled labor in markets throughout the country.


As companies navigate through the recovery, it’s become necessary to implement programs to retain construction workers by offering higher wages, bonuses, and other incentives. Skilled labor is valuable and many companies attempting to attract quality people and rebuild their teams are facing rising labor costs. In order to keep their most valuable employees, companies are adopting creative forms of compensation and incentive programs.

Retention Systems: Keeping the Best and Brightest

Let’s examine several incentive programs to attract, retain and develop workers into the future skilled workforce that will improve the future of your company.

Right Amount in compensation and Benefits:

Compensation can vary widely. Setting annual salaries and competitive bonus plans should begin with research into the average compensation offered by similarly sized firms in your market. Offering employees competitive salaries along with annual increases following a performance review is a strong incentive for them to stay with you. Adding additional benefits such as health insurance for workers and their dependents with full or partial payment by the business, optional dental or disability (at employee expense) or some type of Health Savings Account are also all strong incentives for employees.

Incentives and Bonuses:

In addition to competitive salaries, many companies are beginning to offer bonus programs including profit sharing, performance metrics based bonuses and deferred compensation to retain workers. The key is to clearly communicate and structure any bonus or incentive plans so employees understand exactly what the parameters are for receiving compensation.

Corporate Culture and Work Environment:

Open communication and an environment of teamwork and collaboration are essential incentives to keep employees. Employee engagement is often cited as a major factor when speaking with workers. People want to feel that their opinions matter and fostering a sense of openness is the key. Couple this with a defined career path for growth, education and leadership development and you will retain construction workers.

Employees want to feel valued. While money satisfies this basic need, feedback and encouragement are important tools. People leave managers, not companies. Make sure any systems you put into place also reach the management level. Creating a corporate culture of excellence and a spirit of teamwork from the top down can often go farther than money when it comes to retaining construction workers. Employees want to be part of a winning team. Put retention systems in place that reward and respect their value to your business.

The CLMA® is an online application designed to help owners, contractors, unions and other industry stakeholders dynamically understand the skilled labor market in a collaborative environment and know how to more effectively manage project labor risk.