The Construction Industry: The Young vs. Old Debate
The construction industry has suffered through hard knocks since the market crashed in 2007-2008. Now, even as the economy slowly recovers and certain industries bounce back, the construction sector now faces personnel problems.
What issues are occurring in the construction industry?
While construction activity has increased as the economy has improved (and that demand is expected to continue in 2015), the sector is now dealing with a labor shortage, especially qualified new workers. Another big concern? The current labor force is aging.
What does a labor shortage mean for the industry?
Inexperienced workers are more likely to suffer from work-related accidents than skilled veterans. Additionally, injuries for inexperienced workers tend to be more severe than for seasoned employees.
In fact, Rick Keegan, president of the Construction Business Unit at Travelers, indicates that in certain industry segments, 40 percent of construction worker injuries occur during the first six months of employment. This can drive up contractor insurance claims and also hurt a business’s bottom line.
Why does an aging workforce hurt the construction business?
In contrast, while older workers are less likely to get injured on a job, those that do often cost contractors more in the long run.
There are several factors for this including:
- Injuries often take longer to heal
- Age-related medical complications
- Higher salaries mean contractors pay more in lost wages
Also, older workers that suffer severe injuries are more likely not to return to the workforce, contributing to the workforce shortage.
How do injuries immediately impact business owners?
Accidents on the job can result in an extended disability period for the injured party and can leave a contractor with high medical and workers’ compensation costs.
What is the long-term impact?
While medical costs and workers compensation expenses are an immediate concern for business owners, there are also longer-term consequences that impact the construction industry as a whole. The lack of qualified workers is the biggest challenge.
Aging workers, injuries, lack of newly skilled workers and the economic downturn, which drove away many skilled workers from the sector, have all left dents in the workforce.
Now there is oftentimes not enough workers to get the work done. This trend applies to both blue-collar jobs and professional positions within the industry, such as project managers and safety professionals.
How do I learn more about injuries and insurance?
If you are involved in the construction business; whether as a worker, owner or insurance professional, it is important to monitor all aspects of the industry.
One of those aspects is medical costs and workers compensation. Check with your independent insurance agent to learn more about these topics, no matter what side of the business you work on.
