Reduced In-House Construction Staffs a 'Permanent Condition,' Survey Finds

Construction owners significantly reduced their in-house design, engineering, and construction-management staffs during the recession and do not expect to return to prior staffing levels for many years, if they return at all, a study conducted by FMI, provider of management consulting and investment banking to the engineering and construction industry, and the Construction Management Association of America (CMAA) finds.

More than 300 owners across a wide range of markets and regions responded to the survey, the results of which were presented during the CMAA National Conference & Trade Show in San Diego Oct. 4.

"In the view of more than half of all owners, diminished staff resources are a permanent condition," the survey report says.

Survey respondents anticipate trying to meet their workforce needs by hiring less-expensive workers, hiring retirees, or persuading current staff members to stay on the job past their expected retirement dates.

"The trends described in this report will profoundly affect owners' ability to manage projects effectively," the survey report says. "As a result, owners will increasingly be faced with a choice: scale back their capital design and construction activities (at the risk of compromising mission), risk suboptimal outcomes as a result of staff overwork, or find additional resources outside of their organization.

"How owners perceive and implement these choices will continue to shape the practice of professional construction and program management long after the current economic downturn is past," the survey report continues. "Indeed, these permanent changes in the business environment may be the recession's most lasting and important legacy."

The survey found:

• About half of all owners experienced a significant staffing reduction during the last 24 months. Eighteen percent said their staffs are down by more than 20 percent.
• Owners reduced staff size through attrition (38 percent), layoffs (32 percent), early retirements (19 percent), and mandated unpaid time off (11 percent).
• More than 40 percent of owners expect to resume hiring either in 2013 or later (14 percent) or never (28 percent).
• When hiring resumes, 56 percent of owners expect to have to rely on strategies such as retention beyond retirement, the use of part-time workers, the hiring of less-experienced workers, and hiring from competitor and consultant workforces.

In the long run, the survey report says: "Opportunities exist for more dramatic involvement by all types of service providers earlier in the process. The reported reduction in staffing and difficulty in finding future staff creates a host of opportunities for visionary service providers to step in and fill this void as the health of the construction industry improves."