ABC Keystone Merit Shop Advocacy Blog

by Paul Cuno-Booth, Business NH Magazine

Construction Courting Overlooked Labor Markets

A Longtime Labor Crunch
The construction industry was already facing a workforce crunch before 2020 due to an aging workforce, more young people being steered toward college and workers who left the industry during the 2008 recession and never returned, says Zachary Fritz, an economist with Associated Builders and Contractors (ABC).

Then, during the pandemic, some older workers retired early and the tight overall labor market meant fewer job seekers all around. Meanwhile, a home-building boom created even more demand.

In February, ABC estimated the industry would need to add around 650,000 new workers in 2022 and 590,000 more in 2023—on top of normal hiring—to meet the projected demand for construction.

And those numbers don’t capture a growing skills gap. During the last decade, the number of unskilled, entry-level construction laborers grew much faster than those in the skilled trades, according to Fritz.

“There’s been a serious shortfall of skilled trade workers and workers in the prime of their career in the construction industry,” he says.

And many others are nearing retirement. New Hampshire has the second-oldest construction workforce in the country, with a median age of 46, according to a report from the Home Builders Institute last year.

Companies are feeling the pinch. As of August, Palmer & Sicard, an Exeter-based mechanical contractor, employed about 100 people. Between plumbers, sheet-metal installers and HVAC technicians, it could have used 15 more, according to President Mark Hodsdon.

“It’s really a struggle for us to find all the help we need to complete all the work that we’ve got on the books right now,” he says. “We’re at the point of using headhunters to find tradespeople, and even that comes with minimal success.”

With subcontractors booked out, construction managers are having to adjust project timelines, says Preston Hunter, a vice president at Bedford-based Eckman Construction. “The subcontractors can be very picky in terms of which projects they choose to bid, and their prices reflect that their schedules and calendars are nearly always full,” he says. “So, we’re having to encourage owners to allow us to go out to bid on their projects earlier and to be flexible about start dates.”

Labor shortages have pushed some companies to invest in equipment that saves time on the job site but wasn’t previously cost-effective, including robotic demolition equipment and expensive drill attachments that cut the time it takes to run cable, Reap says. “With the shortage of labor, you buy certain pieces of technology like that to make it go quicker.”

Prefabricating components can also save time and labor on the job site. Hodsdon says Palmer & Sicard has increasingly used prefabrication for that reason. For example, he says, one of its bathroom configurations might take two workers a week to build onsite. In the shop, a single worker can put it together in two or three days.

But technological innovations and efficiency gains aren’t a cure-all for the labor squeeze, Hunter cautions. “At the end of the day, buildings are built by humans,” he says. “ So there really is no technology that can replace the need for skilled people in the trades.”


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Posted Dec. 20, 2022