In an effort to reel in and keep current workers, construction companies are pumping up pay. The labor market for the construction sector is meager at best, with labor statistics indicating as many as a half million construction jobs remain unfilled. Add to that the number of construction workers quitting the profession, and you have a labor shortage crisis.
Overall, the U.S. Labor Department reports there were nearly 11 million job openings in June, which is nearly double the amount of people looking for work.
U.S. companies looking to at least hold on to the workers they have now are raising pay by 4% which is the largest increase in 15 years according to the Labor Department.
Increasing compensation is only going so far in preventing people from quitting, as the recession the U.S. economy is currently in is simply cancelling out the cash incentives. Worker spending power has waned as inflation in June surged at a 9.1% annual rate.
According to a recent survey, almost 25% of companies have increased pay, while nearly half say they will be paying employees more in the near future.
“It’s clear that organizations are attempting to buy more time to read the tea leaves between persistently high inflation, the threat of recession and the state of the labor market before making significant strategic shifts,” says Vice President for Research in the Gartner Finance Practice Randeep Rathindran
According to the survey, about 40% of companies plan on offering bonuses to keep workers.
“Instead of increasing base comp, one-time bonuses aimed at retention — especially for top performing staff —are becoming more common,” Rathindran said in an email to CFO Dive.