Top 5 HR Trends in Construction
The construction industry is evolving rapidly, and HR leaders are at the forefront of the transformation. They're often tasked with staying on top of emerging trends, which can range from evaluating generative artificial intelligence (AI) solutions to improve operations, to complying with complex, ever-changing labor laws.
So far in 2024, we've seen these five HR trends in construction rise to the top: skilled labor shortages, continuous worker training, diversity initiatives, wage competitiveness and labor law compliance.
To stay ahead of the curve, HR leaders need actionable insight. Here's a look at why these trends are at the top of the list and what you can do to prepare for them now and into 2025:
Why you should care about HR trends in construction
In the construction industry, where getting the right people to successfully meet your different project demands is paramount, a well-informed HR strategy is necessary. With the right approach, you can help ensure your workforce is skilled, diverse and engaged — all of which are key factors in delivering projects on time and within budget.
Let's explore why these trends are crucial for your success:
- Skilled labor is the backbone of quality construction. Addressing shortages is imperative for project completion and client satisfaction.
- Continuous worker training helps to ensure your team is up-to-date with the latest technologies and safety standards, reducing risks and boosting productivity.
- Diversity initiatives can lead to a richer talent pool and more innovative problem-solving and help backfill retiring workers.
- Competitive wages combined with offering desirable benefits attract top talent and reduce turnover, which is vital for maintaining project momentum and consistent quality.
- Compliance with labor laws can protect your business from costly legal issues and enhance your reputation as a vendor of choice to win new projects.
5 key HR trends in construction and how to prepare
1. Partnering with an HR vendor that uses generative AI to help with skilled labor shortages
Generative AI is a tool to be taken seriously. It's reshaping how we address many facets of business and can even be used to address labor shortages. With generative AI, you can identify gaps in your workforce and pinpoint the skills people need for upcoming projects. This technology also aids in sourcing candidates and customizing training programs to upskill workers efficiently. When evaluating different HR vendors, be sure to confirm that their underlying employee data is substantial and that the data protection methodology used for benchmarking and analytics provides accurate and actionable results.
2. Committing to continuous, lifelong worker training
The construction landscape is experiencing rapid technological advancements, making ongoing job and skills training a must-have. Providing workers with ongoing education on the latest construction methodologies, safety protocols and digital tools not only enhances their expertise but also fosters a culture of learning and growth.
3. Promoting diversity initiatives
Encouraging diversity isn't just about fairness — it's about enriching your workforce with different perspectives that drive innovation. With an expected 500,000 new construction workers needed in the next year to meet project demands, attracting a diverse workforce has become essential. Initiatives that promote gender equity and inclusivity not only bolster your ethical standing but can also help you attract a wider talent pool that can propel your business forward.
4. Using personalized analytics to help build budgets and manage wages
Keeping wages competitive while managing project budgets is a delicate balancing act. Using AI for compensation benchmarking can help with that. Leveraging organizational, regional and nationally tracked information, you can develop compensation strategies with competitive wages and tailored benefit plans that better reflect industry standards. These tools will help attract and retain skilled professionals and potentially bolster financial stability.
5. Ensuring you have the right systems to be compliant with labor laws
Labor laws affecting the construction industry continue to evolve. In October 2023, several significant changes were signed into law on how prevailing wages are to be paid on government-funded (public works) projects. Effective January 2025, recently passed legislation will raise the minimum salary threshold to $58,000. That could result in needing to reclassify administrative or other salaried workers as hourly/non-exempt and eligible for overtime pay.
Be sure you are prepared to accommodate paying your current contract-mandated wages and benefits while also keeping you compliant with regularly changing labor laws.
Get more on this topic; download our guide: 5 key challenges shaping the construction industry and how to handle them
Preparing your team for the challenges ahead
The construction industry's success hinges on its workforce. By staying ahead of these construction HR trends, you can better prepare your team to meet future challenges and prime them to excel in an increasingly competitive landscape.
The key to thriving in the ever-evolving construction industry depends on investing in your people and systems. After all, these are the foundations upon which your projects are built.
Ready to build a more resilient and future-proof construction workforce?
ADP Workforce Now® for Construction is a comprehensive solution that provides access to pay rate and benefit information for creating competitive employment packages on top of handling all your payroll, compliance and data tracking needs.
