"Often retaining good people isn’t about paying them more money, it’s just about treating them properly."
Finding and retaining skilled people is one of the biggest challenges that many construction companies face. The construction workforce is highly mobile and many companies have a high turn-over of employees. Some managers have an attitude of ‘if they don’t like it they can leave’, or ‘we can’t afford to give them what they want so let them go’. This attitude is costly to the company, and often retaining good people isn’t about paying them more money, it’s just about treating them properly.
Why should construction companies care when people leave?
Every Construction company seems to complain of a lack of skilled people. This problem is often exacerbated when our skilled employees leave to join our competitors, or in some cases leave the construction industry.
"It can cost 16 to 20 % of a persons annual salary to replace them"
Replacing employees is an expensive business. Costs include; recruitment, training, uniform costs, sometimes transport, lost time and production while a replacement is found and lost production while the new recruit finds their feet. (According to one report it can cost 16 to 20 % of a persons annual salary to replace them - read more.)
Then there are hidden costs such as the knowledge the person leaves with – which for a senior person on a construction project could be information required for variation claims, knowledge of clients, client relationships, etc.
Losing a senior competent and knowledgeable person can be difficult to replace as these people are often in short supply.
Losing people often places an extra workload on those that remain behind. This could mean they become overworked and leave the company as well, or it could result in them not being able to carry out their duties properly resulting in mistakes and accidents on construction projects. High Employee turnover? The sooner you know the better.
How do contractors retain good employees?
"It's not all about money!"
The first answer that springs to mind is money. However, you are seldom able to outbid the highest bidder. Anyway do you want to outbid the highest bidder? This is usually an unsustainable practice, it can upset other employees when they find out a new employee is being paid more, and higher wages drives the cost of doing business up. Do you want to employ someone who is only interested in staying if the money is right? Nevertheless, you do need to ensure that the salaries you are paying are market related. However, most employees don’t leave solely because of money, unless the pay is really poor.
There are a number of ways to retain employees which don’t necessarily cost lots of money. Usually just a little effort from management:
"Employees want to feel valued."
"People want to progress and see opportunities"
"Success is empowering, infectious and stimulating. Everyone wants to be part of a winning team"
"Employees want to feel part of a winning brand,"
"Who wants to be frustrated by having their work interrupted by equipment breakdowns, or having to continually repair broken equipment?"
Information in this article is contained in 'Building a Successful Construction Company: The Practical Guide' by Paul Netscher
Good companies are built with good people
Strong companies are generally built by good people. We are usually only as strong as our team. So invest in your team.
By the time a person hands in their resignation it’s difficult to dissuade them. They probably have already explored other alternatives and many would have signed an employment contract with another company.
How do you retain your good employees? In future articles I’ll discuss other actions you can implement.
#constructionmanagement #constructionskills #constructionprofessionals #contractors
Other similar articles by the author:
Providing feedback to your construction team.
Why construction companies should be concerned about their reputation?
Understanding what impacts your company’s reputation.
(Written by Paul Netscher the author of the acclaimed books ‘Successful Construction Project Management: The Practical Guide’ and ‘Building a Successful Construction Company: The Practical Guide’. Both books are available in paperback and e-book from Amazon and other retail outlets. This article is adapted from information included in these books. Visit Construction Management Services on this website to see how Paul can help you)
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The opinions expressed in the attached articles are those of the writer. It should be noted that projects are varied and different laws and restrictions apply which depend on the location of the contractor and the project. It's important that the reader uses the supplied information taking cognisance of their particular circumstances. The writer assumes no responsibility or liability for any loss of any kind arising from the reader using the information or advice contained herein.
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