This article was produced in partnership with Economical Insurance
Karen Surca of Insurance Business Canada sat down with Jim English, senior technical specialist at Economical insurance, and Mark Prosser, manager of commercial lines for Economical Insurance in the Atlantic region. to discuss the ever-present labour shortage in the skilled trades and the preferred route to help address the problem.
There is no doubt that throughout the country, commercial construction is booming. This is despite a drawn-out global pandemic that is not technically completely behind us.
With a housing shortage that is being felt throughout Canada, coupled with major infrastructure projects that are in the pipeline, the need for skilled labour in the commercial construction sector is increasing.
The requirement to hire well-trained and skilled talent remains a pressing concern in commercial construction circles and represents a recognized problem to be systematically addressed.
Economical Insurance, a leading P&C insurance provider with a specialization in underwriting mid-size commercial construction projects, is keenly aware of the real need for new talent when it comes to mid-market commercial projects.
“If you look at leading indicators for the construction segment, they indicate there is going to be a lot more construction coming. There is a real concern surrounding the labour supply,” Jim English (pictured below), senior technical specialist with Economical Insurance outlined.
“Brokers who are sitting down with their construction customers are telling us that it is a topic coming up in every meeting. They are feeling the pinch and there is a real shortage of workers, especially in the skilled trades,” English added.
English points out the recognized deficit in a skilled workforce to bring commercial construction projects to life is having an impact in the short- and medium-term.
Some contractors are forced into the position of having to turn down contracts due to insufficient manpower, or, at the very least, the project is taking much longer than originally projected without the necessary labour to move things along.
“This has been going on for a few years now with a shortage of qualified tradespeople in the industry. If you think of a job site, you have a roofer, steelworker, concrete layers, excavation, asphalt, plumbers, and electricians. So those fields are just trying to attract certain talent,” Mark Prosser (pictured top), manager of commercial lines for Economical Insurance, in the Atlantic region
Some of the factors that have led to the generalized labour shortage in the trades and commercial construction sector have been attributed to demographics.
Prosser highlighted that with a young workforce in the 18 to 25 age cohort in short supply, there is the added pressure of an already aging workforce.
To address this inequality much needs to be done at the educational level to attract those youth that may be interested in a skilled labour job.
This begs the question of “are we doing enough in the educational system to try to attract those younger workers? The number of retirements is outweighing the number of new entrants coming in, and this is creating its own job shortage reflected in the construction trades and we are in a difficult spot,” Prosser reflected.
Beyond the obvious need for recruitment at college level, both English and Prosser pointed to the need for human resources departments to do more to attract and retain skilled talent.
“They (HR) are doing more and more now and spending increased time and effort in recruiting trying to attract and recruit employees, looking at things they can offer such as greater flexibility and other HR-type solutions, which will lead to more productivity on the job site,” Prosser added.
While other options exist to draw talent, such as hiring from competitors, these represent immediate or short-term solutions to a systemic problem.
“On a bigger scale, you have got to start with the talent you are bringing into the industry in general. This starts at the apprenticeship level and at the educational level where you will be getting 18- to 25-year-olds coming into construction on a more macro basis,” Prosser stated.
Looking at other ways to attract and retain skilled labour can also include sourcing talent from outside the country to help fill the shortages that exist. Other remedies expected to continue are wage increases for both general labourers and skilled workers in the construction industry.
“Attention must be paid. Contractors are turning down jobs because they just do not have the resources to get them done,” English highlighted.
Turning to the work of trade associations can also solve a piece of the recruitment puzzle. English pointed out that informed minds are needed to work collectively to try to find ways to pull in the workers to match the demand in commercial construction initiatives.
“There are associations in the construction arena both on a national and regional level that are doing work in this area. The problem was identified a few years back but now we are seeing the direct impact,” English said.
“Construction costs are rising as the costs of materials and labour increase, which impacts the values of the contracts,” English said.
Prosser wants the message to get out “as early as high school to promote awareness of all the opportunities it (the construction trade) has to offer. This is an industry that can offer a career and much more than just a job.”
Efforts to invest in new technology, providing competitive wages, a safe work environment, and offer ongoing learning and training, Prosser stated will also form a big piece of the employment solution.
“Construction is a key part of the Canadian GDP and the front line of the economy. Labour is a significant portion of this equation and investing in this area is important.” English concluded.
Jim English is a senior technical specialist with Economical in Canada. He has spent his career working many years in the insurance, reinsurance, and brokerage side prior to joining Economical in February of 2021.
Mark Prosser is the manager of commercial lines for Economical Insurance in the Atlantic Region. Prosser has spent many years in the industry working in various management and commercial lines roles including business development. Prosser re-joined Economical Insurance in July 2019.
