How to Manage Residential Construction Labor Shortages

By Lynn Pearcey, MBA, Copywriter, AIA Contract Documents

May 18, 2023

If nothing else, the global economy is cyclical, with ups and downs, twists, and turns galore. Economists and financial experts worldwide have been trying to tame the beast that is the economy for centuries, to no avail. Life is grand when things are going well, with sunshine, smiles, and rainbows abound. When the opposite is true, misery ensues with job losses, extended anxieties, and a sky that once stood so shiny and bright falling.

The economy can be fickle, and no sector wears this label better than construction, specifically the residential segment. The nature of this sector can make holding on to skilled professionals a challenge as they often look to other careers with more proven, predictable shelf lives. This leaves builders in a bind as they can’t complete projects without this important part of the mix.

On the Move

Make no mistake; construction, especially residential construction, is a highly transient industry that makes finding and retaining top talent hard. Subcontractors are free agents and can roam wherever the opportunity leads them. In many cases, their allegiance is to their business, but this is not bad; it’s just the nature of the industry. Staff employees, while they don’t fall into the category of subcontractors as they usually have some semblance of company allegiance, it’s essential to know their mindsets are similar in some cases.

Overcoming these and other challenges can be tricky during normal times. But when you factor a global pandemic into the equation, attracting and retaining top-tier talent becomes an even more significant obstacle. If you’re looking to build a stable pool of viable human capital resources capable of servicing all your residential construction needs, here are a few points to consider.

Safety First

Safety is a must in any work environment, but with movement happening in all directions on a construction site, the potential for harm increases exponentially. With so much hanging in the balance, safety must be a priority. Safety saves money, but the message it communicates is more important than the money it saves. Having a safe construction site sends a message to employees and subcontractors that you value their presence above all else and are serious about protecting them.

There are specific OSHA requirements that all construction sites follow but make it your business to ensure you’re following them. Also, make sure everyone on the site understands the emphasis you place on safety and the impact it has not only on the project but on your potential ongoing relationships.

Show Compassion

 A residential construction site is a wondrous galaxy, an often-dizzying array of moving materials, parts, and pieces. There is no argument there. But what’s also true is that there lies a person amid all that movement of each part, piece, or material. In so many instances, site owners lose sight of the fact that the most vital component is the people, and this, no matter how much emphasis they place on safety, is dangerous.

Part of overcoming labor shortages is ensuring the teams you build understand they are valued. Showing value means more than adhering to the guidelines of a state or national governing body. No, this means showing honest compassion and putting their well-being, mental health, and physical health at the forefront of your on-site policy.

Communication and Training

There’s an adage that says the only bad question is the one that goes unasked. It’s true, but there’s another way of thinking about it, especially in the workplace. Sometimes, the so-called “bad” question isn’t asked because the environment the person is working in isn’t conducive to asking them.

Regarding the expectations for your residential construction site, foster an atmosphere where communication and asking questions are encouraged. Remember, you’re not just building this current project but also a network of resources. With that, encourage team members up and down the ladder to ask questions and communicate. From there, watch how well the project moves. More importantly, you’ll notice how much more willing contractors are to work with you, and you’ll also see higher retention rates among your permanent staff.

By now, you’re probably familiar with the term Lifetime Learner. It says no matter how much a person, in this case, a construction professional, learns or thinks they know, there’s always something more to add to the proverbial toolbox. Construction is one of the industries where the principle of lifetime learning applies. Each project brings something new; even if it’s the same build as you did before, there’s always something new to learn.

If your goal is to build a stable team of professionals, make it a point to encourage their hunger for knowledge. Where possible, cross-train them and give them a nudge toward expanding their skills. This will help you, but also shows them that you’re willing to make an investment in them well beyond the current project. That investment has the potential to pay huge dividends down the line.


The economy is fickle, and no segment wears this moniker better than residential construction. With that unpredictable nature comes the challenge of attracting and retaining a stable workforce. It’s a challenge, but one you can overcome. Remember, place your emphasis on the people and not the job. Yes, getting the job done matters, but without the proper personnel to handle the various tasks associated with it, you’re lost. When they feel empowered and heard, there’s no obstacle they won’t work to overcome.

Think safety first, not just checking a box or complying with a regulatory body. Put genuine interest in the well-being of your crews, in every sense of the term. Your safety approach should encompass their mental health, an often-overlooked facet of the construction industry. So by all means, don’t neglect this important area.

Lastly, build environments that champion communications and learning; not just learning what is required on a particular project, but learning in general because this is where growth begins. Encourage crew members to ask questions and grow their skill sets. Invest in them so they can make a more significant contribution to the industry after the job they’re working on is over.

You may not be able to control the economy, but you can control your relationships. And when you infuse these principles into your philosophy, you can overcome even the most challenging economic and labor situations.

To learn more about how AIA Contract Documents can help you with your business, visit To find the right contract for your residential project, see AIA Contract Documents Residential Documents.

AIA Contract Documents has provided this article for general informational purposes only. The information provided is not legal opinion or legal advice and does not create an attorney-client relationship of any kind. This article is also not intended to provide guidance as to how project parties should interpret their specific contracts or resolve contract disputes, as those decisions will need to be made in consultation with legal counsel, insurance counsel, and other professionals, and based upon a multitude of factors.