When Kevin Wilson hires subs these days, he really tries to get a sense of where they’re coming from—literally.
Instead of awarding contracts to his trades community by community, Wilson, vice president of purchasing and national accounts at Irvine, Calif.–based TRI Pointe Group, which ranked No. 15 on the latest Builder 100 list with 5,071 closings in 2018, bundles the communities he has area by area and then pairs them, geographically, with the best subcontractor for the job.
“That lets their folks stay on-site and have less windshield time driving project to project,” Wilson says. “If they’re driving across town to get to our jobsite, we may rethink our purchasing mentality to focus their efforts where their labor is coming from, instead. That helps them be more productive because they’re not driving an hour or two on each end of a long workday. It’s a principle we call ‘podding.’”
Podding, which TRI Pointe also applies to its internal superintendents, is just one tactic the firm uses to attract and retain skilled labor today. In a maddening labor market where builders have plenty of demand but not enough access to skilled labor to meet it, builders large and small are reaching deeper, and becoming more creative, to draw in workers and get them to stay with the company.
Strategies include making life easier on workers themselves—as podding does for TRI Pointe’s trades in the legendary traffic snarls of Southern California—and streamlining operations to become a “builder of choice” for workers who have multiple options of where to work. It also means leveraging technology and processes to lessen the need for as many workers in the first place.
“We’re adapting to this new paradigm, which is one I don’t think is going away,” Wilson says. “There’s just a new level of demand for labor in this market.”
Employer Efforts
In a recent survey for our annual Builder 100 list, respondents selected from five strategies used to attract and retain talent. The numbers in parenthesis represent how many builders chose that particular tactic as one that they currently employ in their business:
1. Promoting from within (77)
2. Employee referrals (61)
3. Offering a top-notch benefits package (43)
4. Paying higher wages than competitors (28)
5. Providing flexible work hours (25)
Those choices focus more on leveraging what companies could do internally to add and keep more skilled employees and less on offering more money to bring workers to them.
One of the reasons why, explains Len Katz, head of builder recruitment at Wausau, Wis.–based panelized builder Wausau Homes, which closed 300 homes in 2018, is because getting into an arms race with wages today almost always becomes a zero-sum game.
“We are paying a very good wage, but we’re not trying to compete with anybody else for talent via wages alone,” Katz says. “We feel that if they came to us for a better wage, they might leave us for a better wage, too.”
Working Lean
Katz is focused on making his own processes so efficient and reliable that he needs fewer workers in the first place, and that the ones who do get hired stay with him. For example, Wausau supplies custom builders with framing packages as well as back office marketing support to provide them with an infrastructure that helps them do more with less. That includes an exhaustive selection of home plans and their framing packages, which can be set by a crew of four in two to three days. Because Wausau focuses on its building system first, Katz says the subs his builders team up with in the field know they’ll have fewer headaches and hiccups on a Wausau job.
“The builders that don’t have a system tend to pay higher premiums for their trades because they’re seen as a higher maintenance,” Katz says. “The electrician bidding the job is thinking, ‘Well, I don’t need this work, and I know this guy isn’t organized, so I’m going to mark it up to make it worth my while,’” Katz says.
Wausau has plied efficiency at its panelization factory to do more with less, too. With a high-water mark of 400 employees pre-recession, including divisions it has since sold, Wausau now makes do with just 60 employees at its plant. “We’re relying heavily on technology, along with business acumen, to be more efficient,” Katz says.
Leveraging Connections
Making things easier on workers is also a hallmark of strategies builders are using to recruit and retain employees internally. At Glen Allen, Va.–based HHHunt Corp., which ranked No. 72 on the latest Builder 100 with 680 closings in 2018, president Steve Fritz says the firm prioritizes the second most selected strategy among builders—using employee referrals.
The company tries to make it as painless as possible for its staff to refer others. Dubbed “Work With Us Here, You’ll Love It,” the firm’s referral program has a dedicated website; an internal mobile app; promotion on the company’s intranet; and a structured program for special employee referral communications. Monetary rewards are tiered based on full-time, part-time, or casual employment status.
“We have a robust internal employee referral rewards program that utilizes the best talent search team we have—our own employees,” Fritz says. “It has been instrumental to our hiring success and makes it easy for employees to submit referrals.”
The firm’s policy of offering paid birthdays off doesn’t hurt, either.
Keep What You’ve Got
Of course, once you’ve got the employees you need, the trick is keeping them. Back at TRI Pointe, Wilson says the company does just that by laying out a clear path to promotion within the company. “It’s fairly common in the construction industry for folks to hop around as they look for promotions,” Wilson says. “We’ve got career paths and ladders set up that help them understand if you want to progress while still staying with us, then here’s how you can do it.”
For instance, someone who starts out on the construction side as a customer care representative might then progress to customer care manager on the path to eventually becoming a vice president of operations. “You’ve got to lay that out for them, because otherwise they think my only way to get a promotion is move companies,” Wilson explains.
Communication with employees is key at Wausau Homes, too. “You’ve got to be transparent about the business, and clear about your mission,” Katz says. “We put people before profits, but we also recognize we can’t take care of the people without the profits. Having that transparency and taking care of them tells them we don’t want to lose you.”
By making an effort to make workers’ lives easier, striving for efficiency to limit the amount of labor needed in the first place, and painting a clear way forward, builders can attract the employees and trades they need today, and keep them for tomorrow.
