The Labor Issue Is NOT Going Away
2006 or 2019: Somethings are not changing…
Front page news! ENR May 8, 2006 stated, “firms seek new solutions to keep employees in place.” This critically important issue has been with us for over TWO DECADES. We should not be surprised it is getting worse. During the lean times of the past we were warned. Warned that job-hopping would increase once the economy picked up. Employees were fed up with being overworked, under-appreciated, under-paid, and taken for granted. Now, more than ever, good employees are moving on and firms are dismayed. Those facing higher-than-normal turnover today are getting what they deserve. They are paying the price for continuing to use a management style and philosophy that is better left in the last century. Author Steven Covey, in The 8th Habit, says that this is the century of release, not control.
Turnover is an indirect cost and, because it is not directly measurable, it is often discounted. Construction executives would rather operate in the tangible world of cost reports and bids won and lost than in the intangible world of taking care of people. I must clarify that simply providing a paycheck is not “taking care of people.” Management must develop employees to step into positions of increased responsibility and impact. Enlightened firms instill a strong sense of corporate culture, through open and honest communication—not by decree.
In fact, the number one antidote to turnover is hard to measure also. It is leadership. Unfortunately, that ENR article never mentioned the word. And only once in three pages is the concept of employee development mentioned. Yet, many times, pay and benefits issues are discussed. Once again, the default position is to the tangible subject of money, away from the abstract idea of developing people. But the last sentence, from a man who had been with the same firm for 55 years, speaks loudly: “If you’re happy and content, you don’t look for other avenues.” It’s not high pay that makes workers happy and keeps them fulfilled.
Leadership is not the only solution to the labor crunch, but it is where the primary fight needs to be waged. Firms often make the mistake of sending people to development programs expecting them to come back… different. The reality is that change only begins in development programs. It must be reinforced by executives back on the job–executives who probably need the same leadership program they are sending their people to.
As a speaker and consultant on leadership, I am often told by managers I work with, “This is great! But the person who really needs to hear it isn’t here.” Too many bosses in construction are, quite simply, poor leaders. The personality profile of many of these managers is that of a task-driven, detail-oriented individual. They are hard-wired against building relationships. But leadership, at its heart, is a relationship. And relationship-building can be learned. Integrity and core values are what cement employee loyalty–not a 1% match to their 401K.
Look at Fortune magazine’s Top 100 Companies to Work For in America and you will see examples of well-led firms across all industries, including construction. Many of these firms don’t pay the best, yet they enjoy best-of-class turnover and employee satisfaction. How do they do it? My research, experience and consulting work points primarily to leadership–leadership that anticipates change and encourages open, even sometimes messy, dialogue about difficult issues. Leadership that fundamentally trusts, respects and values people. Leadership that engages people. Why? Because people who feel valued don’t look for new jobs. They look for ways to do their current jobs better. People who are engaged eagerly come to work with not only their hands, but their head and their heart as well.
Good leadership is not passive. It is proactive and looks for opportunities to engage people. Think of your all your employees as the teeth on a large gear. The gear is just sitting there, doing nothing. Your people are also doing nothing. To get this gear to move, we need a stimulus–another gear to engage the idle one. Leadership is that necessary drive gear. Until leaders engage them, the workers will remain idle. But once we take action, the gears mesh and forward progress begins.
Leadership is all about engagement, and it is the foremost antidote to spiraling, out-of-control labor costs and turnover. Yes, market rates must be paid. But bidding wars for talent still leave employees wanting more. What they want is to be trusted, respected, engaged, and challenged at work. They want to be led.