Employee turnover (also called churn) is higher in construction relative to other industries. While many workers have remain committed to the same firm for years and even decades, that has increasingly become an exception to the rule in construction.
First off, let's define turnover:
High turnover rates for construction tradesman are rooted primarily in two dynamics.
The first is that construction employers frequently reduce a significant portion of their workforce through layoffs at the end of each project. For some firms, that portion could be up to 50% or more of their workforce.
The second dynamic leading to high turnover is that construction workers are increasingly opportunistic when it comes to pay. In a survey conducted by Buildforce with 39 participants (all construction workers), nearly 50% of respondents said they would switch jobs for a pay increase of $1.00, $2.00, $3.00, $4.00 per hour regardless of lost benefits, and exactly 50% also said they would switch jobs for a one time bonus payment of $250.
The scale of employee turnover is striking. One large construction firm headquartered in Texas reported that their annual turnover rate was over 400%. Similarly, a crane operator who is a member of the Buildforce network told us that he worked as a W-2 employee for eight different companies in the year of 2019!
Turnover is expensive. A head of HR from a construction firm headquartered in Houston, TX reported to our team that total HR costs for a short-term employee can cost up to $10,000, or about 20% of a worker's annual wages. These costs include:
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