The Construction Industry Workforce is Getting Older
Shifts in workforce age demographics are normal as one generation begins to age out and the next generation enters. However, new statistics show that the construction industry appears to be aging faster than it can replace older workers. It’s an issue that will have to be addressed in the coming years if the industry intends to keep pace with growth in new-home construction.
The 2018 Current Population Survey found that the amount of construction workers ages 55 and up increased from just under 17 percent in 2011 to almost 22 percent in 2018. Meanwhile, the number of construction workers ages 25–54 declined from about 75 percent to 69 percent. As the construction workforce continues to age, the industry is still struggling to attract younger workers. The same survey found that workers under age 25 make up 12.3 percent of the overall U.S. labor force, but in the construction industry they represent just 9 percent.
Worker age in the construction industry is increasing at a faster rate than worker age for all U.S. industries combined. Numbers from the 2018 survey show that about 69 percent of construction workers are in their prime working years, which is considered to be ages 25–54, while the overall workforce has 64 percent in this age group.
According to Bureau of Labor Statistics data from the U.S. Department of Labor, the average age of workers in the construction industry is 42.5. The shift to a 42.5 year average age from a 40.5 year average age happened within a 7-year time frame in construction. By comparison, the average age for all workers in the United States increased by less than one year during the same 7-year period.
Two main contributing factors to this dramatic age shift are likely the size of the Baby Boomer generation and the 2007/2008 Recession.
By 2020, the youngest members of the Baby Boomer generation will be entering the 55 and up age group. The next largely-represented age group are workers 35–55 who belong to Gen X—a much smaller generational group than Boomers.
During the recession, more than 2 million construction workers lost jobs within three years. Many younger workers lost their jobs, while older workers in higher positions, such as inspectors, supervisors and managers, were more likely to stay in the construction industry even when the economy was in a downturn.
“Workers left the housing industry during the Great Recession, and many will never come back as they found other jobs in other industries,” explains Mark Pursell, CEO of National Housing Endowment.
An aging workforce, which likely means a large portion will exit for retirement in the near future, could present challenges at a time when falling mortgage rates are boosting the housing market recovery. The National Association of Home Builders reported that unfilled jobs in the construction sector reached a post-Recession high in March of 2019, making access to labor a top business challenge for the year.
“This change we have seen, and continue to see, in the construction workforce is affecting all aspects of the market,” explains Tony Mancini, Group Director at SGC Horizon.
If the construction industry isn’t able to recruit younger workers, it could lead to more expensive housing, longer build times, and projects that don’t happen, according to Pursell.
The aging workforce is pressing the search for solutions. “Builders and remodelers are looking for new technologies and building methods to construct homes,” says Mancini. “We are finally seeing a focused effort to recruit and train the younger generations,” he adds.
Some of those efforts, such as the Skilled Labor Fund, already exist. “The Skilled Labor Fund has invested in 30 high school programs, providing training developed by the Home Builders Institute,” says Pursell. “The Fund has also sponsored 30 career fair events under the ‘Career Connections’ grant program, [and] an estimated 20,000 students will participate over the next 18 months.”
For builders who want to attract younger workers, Pursell recommends local engagement. “Get involved in your local builder association and volunteer at career fair events at the high school and middle school levels.”