Raising the Bottom Line

7 Common Sense Employee Retention Strategies for Construction Contractors

Posted by Steve Ball on Thu, May 10, 2018 @ 09:19 AM

construction company employee retention strategies

For three consecutive years, construction contractors in Maryland have reported that finding and retaining good employees is their #1 concern.

In fact, according to our 2018 Maryland Construction Industry Survey, the number of contractors who ranked employee recruiting and retention as their top concern jumped from 64% in 2016 to 75% in 2018. That’s quite an increase!

With many Maryland contractors reporting a large backlog of work in 2018, this jump is not surprising. As contractors battle to find, manage and complete new projects, a construction company’s ability to retain its best employees is paramount to success.

 employee retention is top concern for construction contractors

If you’ve ever been tasked with hiring new employees, you know what a time consuming process it can be to identify candidates, interview them, check references, complete the necessary paperwork, and train them. And if you’ve ever had to deal with an employee’s poor job performance – and maybe even terminate them – you might be ready to throw your hands up when it comes to managing personnel issues. HR is no walk in the park.

All of this points to employee retention playing a key role in your company’s stability and profitability.

Wouldn’t it be nice to worry less about, and spend less time on, finding and hiring new employees? When you can spend more time securing new projects, fine-tuning your bidding process, and giving your customers five-star treatment, you’re winning.

That’s why we put together a list of common sense employee retention tactics for construction contractors.

1. Give feedback to employees after every job.

More than a third of Maryland contractors indicated they don’t give feedback to employees after each completed job.

Say what?

construction employee feedbackA key attribute of high-performing employees is their desire to know how they are doing, and what they need to do to improve. Using a short, to-the-point construction job employee evaluation form can make it easy to quickly document job performance notes, review them with your employees, and give them advice on how to improve.

Get more data on the state of Maryland's construction industry.

In addition to giving your employees feedback on their job performance, we recommend that you also communicate expectations before each job starts.

2. Ask employees for feedback on YOU.

Just as it’s meaningful for your employees to get job performance feedback from you, it’s worthwhile to ask your employees how YOU are doing.

Here at our own firm, we conducted an upward feedback survey of our supervisors and upper level managers. Our staff was asked to evaluate the supervisors and managers with whom they work most often. Their written feedback, which was collected anonymously through an online survey tool called SurveyMonkey, was given to our supervisors and managers so they could better understand how they are performing in their leadership roles, and how their leadership style is perceived by staff members.

upward feedback survey

The survey asked employees to evaluate their managers on things like communication skills, training ability, and tendency to give (or not give) useful feedback. The survey also invited employees to share ideas for how a specific supervisor could improve.

While an upward feedback survey can make a company’s management team a little uncomfortable, the benefits of knowing how employees – especially the top performers you don’t want to lose – perceive you far outweigh the risk of a little short-term discomfort.

3. Reward your best employees with salary increases.

This sounds like a no brainer, but you might be surprised to hear that nearly 20% of Maryland construction businesses gave NO salary increases in the last 12 months.

Yet for the third consecutive year, Maryland contractors have said money is the #1 reason why employees leave their company.

salary is top reason construction employees leave

We’d be remiss if we didn’t advise you to keep salaries competitive. If time and time again, employees tell you they’re leaving because they found more money elsewhere, maybe it’s time to rethink your pay scale.

On a related note, continue to offer good medical, dental and profit sharing plans. Our 2018 Maryland Construction Industry Survey showed that contractors are largely offering stronger benefits packages than they did in 2016.

4. Have a succession plan and be (at least somewhat) transparent about it.

In the past, keeping a company’s future plans hush-hush behind closed doors was the norm. But today, employees – especially high achievers – want to know about their employer’s road map for the future, and their role in the company.

While it might not make sense to divulge every last detail about your company’s plan for the future, let your employees know that your company HAS a future. If you’re a 67-year-old sole owner of a home building company, your employees, particularly your more experienced employees, are most likely wondering what the future holds for them. If they assume you’re just going to sell the business and retire, they might jump ship to what they perceive to be a more secure position.

If, on the other hand, you tell that same employee that you’ve identified your lead project manager (a well-liked and long-time member of the company’s management team) as your successor, it’s more likely that the employee will stick around for the long haul. Even better, you’ll tell that employee about the time frame for the leadership transition, and explain how it will impact him or her.

Being open about your future plans can go a long way to keeping your best employees engaged and loyal to your company.

5. Give your employees a sense of purpose through community service.

Roughly 75% of employees say teamwork and collaboration are “very important” to them, according to a report by ClearCompany.

Company-sponsored community service projects offer a way to boost teamwork and collaboration outside of the normal day-to-day grind. Most importantly, community service projects give employees the opportunity to feel like they are part of something bigger than just an HVAC repair job, a road crew or a drywall project.

Community service is clearly an important pillar of this Maryland construction company’s corporate culture:

community service for construction companies

I can personally attest to the value of company-sponsored volunteer projects. For the last seven years our firm has offered structured community service opportunities to employees. The vast majority of our staff – from administrative personnel through partner level – participate in organized community service projects. Whether it’s sorting food donations at the Maryland Food Bank, cleaning kennels at the Maryland SPCA or serving hot meals at Paul’s Place, volunteering together builds camaraderie among our team members, who in turn, feel good that their firm is doing something good for the community.

Bonus! Participating in community service projects can also offer leadership development for your staff, not to mention the opportunity to create goodwill in your community.

6. Offer leadership training.

About a quarter of Maryland contractors said they were either “doing poorly” or “have no leadership development programs or initiative.” (2018 Maryland Construction Industry Survey)

If you’re among those construction companies that could be doing better when it comes to developing future leaders, there are a number of things you can do to improve:

  • Talk with your top performers about their career path. Ask where they want to go within the company, and help them carve a path to get there.
  • Send your top performing employees to leadership training outside of your company. The Maryland Center for Construction Education & Innovation and Maryland Construction Network are resources for various types of training.
  • Ask your best foremen and supervisors to mentor your most promising up-and-comers. There is often no better training than on-the-job training.
  • Offer training on soft skills, which often go overlooked when you also need to train your employees on technical skills. But it’s often the “soft” skills like communication, conflict resolution and teamwork, that build future leaders.

7. Share successes within your organization.

When is the last time you took a moment to celebrate your company’s success? More important, when is the last time you celebrated a success WITH your staff?

When you’re going from job to job, analyzing your company’s latest numbers or putting in a last-minute bid, it’s easy to forget about communicating your successes to your team.

Take a few minutes to let your employees know about your wins. Tell them about a new job you just won or a positive online review from a customer. It’ll help your staff understand where new business comes from (and perhaps feel more confident about generating new business on their own), boost morale and make them feel proud about their company.

Start Focusing on Employee Retention Today

Even if you implement one or two of the employee retention ideas above, you’ll be headed in the right direction. For advice about how to keep your best employees happy, contact us online or call 800.899.4623.

 2018 Executive Summary

Tags: Steve Ball, construction, employee retention, 2018 Maryland Construction Industry Survey