Using Contract Skilled Labor Can Save You Time, Increase Profit and Productivity
By Ed Rojeck, Tradesmen International
As economic and health uncertainties continue nationally, the construction industry has, nonetheless, remained “essential” and continues to with the The Dodge Momentum index ending 2020 on a high note with a 9.2% jump in December(1). With the increase in vaccines, 2021 should prove to be a better year for the construction industry. While experts predict a stronger 2021, contractors are now faced with two workforce staffing challenges related to ever-shifting COVID-19 market restrictions:
- Determining how many full-time workers to bring back knowing workload spikes and declines are both more severe and frequent during the crisis.
- Filling full-time trade positions is even more daunting as many construction workers have health concerns related to returning to job sites and/or are taking advantage of unemployment benefit extensions and increased pay.
How are contractors addressing these challenges? They are once again embracing a successful workforce staffing strategy utilized during the Great Recession. Similar challenges were faced then and by incorporating this easy-to-implement strategy, contractors were able to effectively sustain a balanced work-to-worker ratio through constant project starts and stops. This fortified their businesses by keeping labor costs minimized and profit margins maximized.
When it comes to staffing in times of uncertainty, it is safer and more prudent to run a leaner full-time workforce, comprised only of top craft professionals, and supplement that core craft workforce with contract skilled craftsmen on an ‘only as needed’ basis. This ‘just-in-time’ staffing tactic creates a logical core staff level, avoids costly spikes and dips, and regularly saves businesses thousands of dollars over the long term.
An even greater motivator for embracing this strategy now is the timeframe. Unlike the previous recession, construction projects during this current COVID-19 impacted economy are rebounding within months versus multiple years.
By using skilled labor staffing companies, contractors are saving time and money, while increasing productivity and profits. Businesses of all sizes can work with skilled labor staffing companies. Tradesmen International for example, provides contractors with labor management trained Consultants who use a proprietary Labor Productivity Analysis to ascertain what volume of full-time craft employees makes sense for their businesses now and for the long-haul. In addition, they can provide guidance on identifying which specific craft employees should be brought back on after being laid off, by utilizing a custom W2 analysis.
This staffing strategy is exactly right for today. With governmental and healthcare expert opinions varying day-by-day on which state, or which businesses should open and when it makes sense to play it safe with non-committal, flexible staffing.
In many cases, project workloads are hard to predict week-to-week, forcing contractors to scramble to find job-ready skilled tradespeople at the last minute to send to a work site. That scramble leads to sacrifices in safety, worker skill, deadlines, or budget overruns. By adopting a stable core staffing level, supplemented by on-demand staffing, contractors actually find they can afford higher quality professionals with no sacrifice to job profitability.
When workload begins to ramp up beyond what a leaner core workforce can handle, companies avoid adding permanent payroll. Like the period after the 2009 recession, they’re supplementing their core workers with contract skilled craftsmen. By sending skilled trades employees back when workload slows, clients are sustaining a more profitable, productive workforce.
Using contract skilled labor has other advantages that positively impact contractor bottom lines. In addition to payroll and unemployment benefits, some labor staffing companies even cover benefits and Workers’ Comp related costs and risks on their employees. This shelters contractors from expenditures they’d normally have to pay on short-term, full-time workers.
Tradesmen International's CORE+Flex workforce strategy fits these times by providing guidance and working with businesses to determine optimum staffing mix. Tradesmen International is offering contractors across America a free consultation including a custom Labor Productivity Analysis that, using client data, enables contractors to implement a logical CORE+Flex staffing strategy.
(1) Dodge Data & Analytics / January 8, 2021