Construction Hiring Challenges: Key Factors Impacting Talent Attraction

The construction, construction equipment, and building materials industries play a crucial role in shaping the modern world. However, as the industry continues to integrate advanced technology and improve sustainability, attracting and retaining talent is increasingly becoming a challenge. 

According to Associated Builders and Contractors, the construction industry needs to hire an additional 454,000 workers in 2025 to meet labor demands. Talent shortages, skills gaps, and an aging workforce are putting pressure on businesses to reconsider their hiring strategies so that these challenges don’t become a barrier to long-term growth. 

Talent Shortages

One of the biggest construction hiring challenges is the shortage of available talent. In a survey by AGC, 89% of construction firms reported difficulties in filling job vacancies, and 61% experienced project delays due to labor shortages. 

These industries have aging workforces, with the age of construction workers in the U.S. at a median average of 41.9, according to the Bureau of Labor Statistics. Additionally, over 41% of the current construction workforce is expected to retire by 2031, which could further intensify the talent shortage in years to come. 

The main issue is there isn’t enough younger and newer talent entering these industries, which makes technical roles, such as equipment repair technicians, very difficult to fill. This is partly due to the fact that jobs in construction aren’t as popular as they once were, with only 6% of young people stating a desire to work in the sector, according to Construction Industry News. 

However, according to The Construction Index, among the young people that do like the idea of a job in construction, 35% stated they felt this way because they identify the industry is going through exciting change, which does offer some optimism for the future of the industry. 

Competition from Other Industries and Retention Challenges

Another major challenge in these industries is the competition for talent is tougher than ever. It doesn’t always have the high salaries and perks of other industries, causing some people to see it as a less attractive option. 

Because of this, retention is another big challenge. According to ABC SoCal, the construction industry's turnover rate was 5.2% in 2024, which is higher than the U.S national average of 3.7%. 

Despite this, Alex Zakrevskis, Capital Equipment Dealerships Specialist at CSG Talent, points out that working in the construction industry is a great opportunity for candidates at all levels: 

“There are a lot of benefits to working in the construction industry, such as advancements in machinery, increased automation, and sustainability initiatives. It’s also an industry that offers a relatively strong level of job security, as construction skills, equipment, and materials will always be needed. The challenge is changing perceptions to make people realize these opportunities.” 

Technology and Skills Gaps

The construction industry is always evolving, with new technologies driving innovation and growth all the time. From advanced machinery equipped with innovative automation to the increased use of CRM systems to manage client relationships, the sector is becoming increasingly driven by tech. Although these innovations are great for improving safety and productivity, they do create challenging skills gaps. 

Many workers in construction have built their careers on traditional skills. However, as the use of technology increases, the skillsets required are changing. For example, operating modern excavators requires knowledge of onboard diagnostics and telematics systems, which are skills that weren’t needed until recent years. 

The issue isn’t necessarily a refusal to adapt from the workforce, but more a lack of accessible training programs that help them do so. This can discourage professionals from working in the construction industry, as they may believe the learning curve is too steep and choose a career in a different sector. 

Geographic Challenges

In the US, construction equipment businesses in particular prioritize local hires over searching for talent from overseas. Although this increases the regional knowledge of candidates, the limited search area does massively decrease the talent pool. 

One of the reasons businesses prefer to hire local talent is that visa complications, moving fees, and lengthy processes make hiring talent from other continents a much less viable option. However, this could be seen as a missed opportunity, especially when other countries have skilled talent who would be eager to move to the U.S for a career in construction. 

U.S Election Impact

The 2024 U.S election caused a dip in activity in the second half of the year, as businesses waited to see whether there would be a change in government. This was especially the case in the construction equipment industry, as the machinery is so expensive that interest rates can have a huge impact on the finances of businesses, causing many to wait for the result before making any decisions or purchases. This led to the sales of earthmoving, compact, and off-road materials handling equipment decreasing by approximately 10% throughout 2024, according to Crane and Transport Briefing. 

However, with Donald Trump becoming president, interest rates are set to gradually decrease from 5.4% to 4.0% by Q4 2025, according to the OECD. This is a welcomed boost to the construction equipment industry, as the general feeling is that the sector will bounce back significantly from a slow end to 2024, with businesses having a greater incentive to buy knowing that interest rates are now secure. 

Lack of Diversity 

When it comes to diversity, the construction, building materials, and construction equipment industries are falling way behind some other sectors. These fields are dominated by a narrow demographic, and there is a clear lack of gender, racial, and cultural diversity. 

For example, women make up just 14% of the manual construction workforce in the United States, according to the U.S. Department of Commerce. In addition to this, only 21% of companies have female representation at director level. Racial and ethnic minorities are also underrepresented in many key positions, despite making up 47.1% of the workforce. 

This contributes to the industry’s talent shortage, as businesses miss out on a large pool of diverse talent who could offer fresh ideas and perspectives in leadership positions. 

Construction Recruitment Experts at CSG Talent

Although the construction, construction equipment, and building materials industries are facing some significant hiring challenges, there are also exciting opportunities for businesses. Embracing skills first hiring, encouraging diversity, and upskilling your employees are just a few of the ways your business can combat these challenges and build a stronger workforce. 

By partnering with CSG, you can navigate the complexities of executive search in your sector and develop a tailored hiring strategy to secure the talent you need to thrive. Contact our executive search specialists today to discuss how we can help you overcome your construction hiring challenges. 

Explore Alex Zakrevskis’ expert insights on solutions to overcome construction hiring challenges. 

For more expert insights on recruitment trends in the US, discover our industry showdown.