Five Ways to Help End the Craft Labor Shortage

Issue 11 and Volume 111.

The craft labor shortage is pinching profits and complicating projects. Here’s how the power industry can address, mitigate and even help reverse the trend.

By Ross McConnell, Vice President, Corporate Services, Day & Zimmermann Power Services

If a picture is worth a thousand words, here’s a power industry snapshot: A recent industry census identified a total of 38,000 skilled union laborers in 11 Southeast states. Yet data collected by the Construction Labor Research Council showed demand exceeding that number by more than 15,000 workers. And those workers were needed just to complete work created by the post-Hurricane Katrina construction boom.

This sort of labor shortage picture is all too familiar to the power industry, where the rise in unfilled construction/maintenance jobs is straining an already tight workforce. The problem will only get worse as plants require maintenance and modifications, and skilled workers remain in short supply.

But there is a silver lining to this otherwise dark cloud. Understanding the labor market and instituting proven recruitment strategies can help the industry stem the tide, without compromising quality or safety.

Labor Force Shrinking

National labor market issues, such as the shrinking, aging or less-skilled workforce, are squeezing the talent pool on a macro level. Virtually every industry that depends on a skilled craft labor pool is feeling the pinch. In the power industry, the pinch is even tighter.

Several factors are at work. The first is the educational system’s failure to promote the trades. Most career guidance today focuses on college prep and the military, not trade schools. Students simply aren’t encouraged to enter power industry fields.

Industry conditions make matters worse. Consider outage length. Outages that once took 60 days now take 20 to 30, halving laborers’ earning power. Couple that with Gulf Coast rebuilding projects, which promise long-term employment and lure workers away from short-staffed regions.

The industry is also lagging behind the wage curve. Other construction sectors have seen wages grow 10 percent to 15 percent annually over the past three years. Many power companies, however, are holding the line on wages, limiting the appeal of industry jobs.

Lastly, governance under the Homeland Security Act severely constrained the labor pool. Power industry employers now are required to pass over workers who may have what used to be considered negligible infractions in their records, to maintain strict compliance with security requirements.

Taken in total, these factors mean little new blood is joining the workforce and also foreshadow a larger labor crunch in the future. For example, the industry will be short more than 200,000 skilled welders by 2010, according to the American Welding Society and additional industry research.

And that doesn’t take into account every other role, from pipefitters to crane operators to insulators.

Powering-up a Solution

Clearly, the industry must stem or reverse this trend. While there’s no silver bullet, contractors can steadily improve the hiring climate with a series of best practices for recruiting and training talent.

First, polish the industry’s image. Many people still view power plant jobs as dirty, demanding and unglamorous. Educating young adults and parents about the work, and focusing on the excellent growth opportunities, will help promote power industry careers as safe, respectable, rewarding and lucrative.

Second, promote the industry through community outreach. Marketing efforts should include presentations at high schools, technical schools, military outplacement agencies and community colleges; and local advertising on radio, television, in print and especially online, to reach the younger audience.

Third, training also plays a crucial role in attracting and retaining employees. Contractors and power industry employers need to provide accelerated training programs, internships and co-ops that let recruits earn education and experience simultaneously.

Fourth, structured mentoring programs with on-site guidance help veteran journeymen transfer their knowledge to the next generation, and shorten new employees’ learning curves.

One example of a proven training program is “Helmets to Hardhats,” a congressionally funded program that has placed more than 1,700 veterans in civilian jobs. After evaluation, vets join union apprenticeship programs based on military skills they acquired.

Fifth, some power industry service providers can help craft workers sustain a steady flow of assignments by training them to plan their work-year around scheduled plant outages.

Contractors should also stay connected to local unions, and communicate work needs as early as possible. That helps the union networks funnel members to areas most in need, provided fair and reasonable rates are available.

In the end, every viable solution to the craft labor shortage requires money. Power companies who want to fill their ranks with the best and brightest must prepare to invest in broad training and outreach programs, offer competitive wages and open more work opportunities.

It will certainly take time to turn things around, as the industry adjusts to an updated image and longer-term goals. During this period, owners must stay in contact with partners and employees and clearly communicate their labor needs, as well as what they’re doing to improve the labor pool.

By recruiting, retaining and rewarding skilled laborers through a proactive approach to growing the labor pool, the power industry can curtail the shortage short term and restore workforce strength long term.