Do you suppose there's any possible connection here? Skilled construction labor capacity is getting tougher and tougher to count on, and, by the way, two out of five construction firms either merely break even or lose money?
Here, a National Association of Home Builders economics department analyst Benjamin Whetzel checks in on the Census's Annual Survey of Entrepreneurs data indicating 61.3% of American construction firms are profitable commercial enterprises.
The good news is, that's not much worse a performance than turned in by American entrepreneurs across all fields of business. Whetzel notes that the shares of construction businesses recording positive profits, breaking even, and sustaining losses are all within 1.2 percentage points of the averages across all U.S. industries, albeit slightly to the worse.
When it comes to naming the key reasons that conspire against construction firms' profitability, taxes rank highest, as one might think, as the most meaningful nemesis. But here's where construction differs most from the rest of industry sectors: finding qualified labor; and late/nonpayment by a customer.
This begs a question: in many of those cases, aren't home builders operating as the customer?
The data also begs another, even more wicked question. Why, given the hourly prices skilled construction labor charges these days, are as many firms failing when it comes to profitability?
It could be that a lack of motivation--complacency--is part of the reason more construction firms don't make money.
Think about it, if you and your associates only do the work spelled out on your job description, is it enough to make the company a go of it? Not, in our experience.
If a team limits itself to on par performance, something gets lost. In this Harvard Business Review essay, business school professors Mark C. Bolino and Anthony C. Klotz write about "How to Motivate Employees to Go Beyond Their Jobs." They note:
Every day, employees make decisions about whether they are willing to go the extra mile in ways that contribute to their organization’s success. These are important decisions because research shows that when employees are willing to go beyond their formal roles by helping out coworkers, volunteering to take on special assignments, introducing new ideas and work practices, attending non-mandatory meetings, putting in extra hours to complete important projects, and so forth, their companies are more efficient and effective.
The challenge Bolino and Klotz raise is to motivate and manage so that workers go that extra mile. They offer an innovative approach, suggesting that managers and employees profoundly remap and "craft" parts of their jobs--their tasks, their workmates in a given workflow, and their mindset--so that both the job performance and the sense of motivation and purpose are more aligned. It doesn't look like an easy, turnkey process, but, especially in the world of construction where so many individuals' performance interlocks and interdepends with others'.
Bolino and Klotz conclude:
The bottom line is that managers and employees’ efforts to enhance the meaningfulness of work by redesigning employees’ jobs should not stop where the formal job description ends. Instead, we encourage employees to more thoughtfully and proactively craft their citizenship behavior in ways that their extra-role contributions lead to more meaning and fulfillment while, at the same time, enhancing their firm’s performance.
That could make more construction firms more profitable, which would make them more appealing places to go to work, which would play at least a part in adding to the capacity of the skilled labor force, as we so need to do.
