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Human resource planning in the construction industry; can it ever work?

Construction Industry

Human resource planning in the construction industry; can it ever work?

Construction Industry involves in its vicinity a diverse labor force, contributing towards the long and enduring “Process of Creation”. As cited by Gerald Finkel in his book, “The Economics of the Construction Industry”, The American construction industry employs over five million people and provides millions of additional support jobs in related fields. Yet, it is least lucrative profession for many as it involves peripatetic work schedule, along with it job insecurity associated with poor working conditions, health and safety records and employee welfare provisions within the industry.

The main reason behind the Construction Industry to be poorly regarded is generally thought to stem from the nature of the work and the terms on which the labor is recruited. The construction Industry in number of countries has also been characterized by the outsourcing of labor through sub contractors and other intermediaries that prohibits them from taking the advantage of employment schemes.

Over and above, it has a long been portrayed as the image of discriminatory “Macho culture". Moreover in number of developing nations there are no safety measures for laborers. For e.g. as cited by International Labor Organization, “In countries such as Cambodia, construction workers earn just US$1.50 a day and there are no laws to provide safety measures to workers,” thus, here the role of Human Resource Management Comes in.

The managers in this Industry are often heard saying ‘our people are our most important asset’. However, human resource management (HRM) in the construction industry is severely under-developed as compared to the other industrial sectors. This we may owe to the fragmented structure of the construction sector. However, Industrial leaders have started realizing the importance of the ‘human resource’ in this competitive environment.

As stated by Paul Teicholz (1994), there was decline in the construction industry. Over the past 40 years the Industry increased at an average compound rate of -0.59%/year. There had been a requirement of more field work hours per dollar of contract. The construction industry lagged behind other industries in development and in application of labor saving ideas and in finding several measures to substitute equipment for labor.

The casual nature of the employment in the construction Industry makes planning a vague exercise. This is the Human resource information systems(HRIS) that presents number of measures to cope with these problems ensuring reliability, accuracy and accessibility of the human resource information.

The construction industry is one of the largest sectors employing large number of people, providing work to significant proportion of the labor market and providing significant share of the world Gross Domestic Product (GDP). Any construction project involves skilled manual labor which gets support from management. It is a duty of the management to coordinate many professional, construction and supplier organizations whose involvement can change through the course of the project. The dynamism that involves in the process and the need to integrate a wide range of occupational cultures, gives the construction one of the most complex project related Industry in which there is a need to apply good
Human Resource Management (HRM) practices.

According to Decenzo and Robbins, “Human Resource Planning is the process by which an organization ensures that it has the right number and right kind of people, at the right place, at the right time, capable of effectively and efficiently completing those tasks that will help the organization achieve its overall objectives”. The main aim of Human Resource Management is to ascertain the manpower needs of the organization both in right number and right kind. And it's quite true with the Construction Industry.

In the phases that Construction Industry passes through, it becomes adequately apparent to retain the professional employees in order to remain in competitive market. The employee turnover and wastage is an extremely important issue for construction companies, thus Human Resource Management (HRM) is an essence of the Construction Industry whereby it build up its image by creating an environment of trust between the employees and employers by looking into the every aspect of the employees needs.

Several researches have found that money has never been considered as the major criteria to retain the labor force in the ensuing projects. It is a motivational force that accounts for high performance by executives. Recent studies conducted by Hay Consulting Group and Hornberger Management Company’s Annual Construction Executive Retention Survey suggested that executives work hard and achieve more to have a feeling of fulfillment and attainment of Fruit. This sole motivation is provided by Human Resource Management Team.

In the construction Industries companies relies in sub contracting in most of the construction phase. Therefore the construction industry includes large number of small and medium sized enterprises which carries on its operational activity for large main contractors. Hereby the Human Resource Management may not work as per the organizational set up. The wrong sub contractor if appointed can lead to numerous losses and his removal is the most agonizing thing to do. Athough there are advantages in adopting the subcontracting system and some strategic benefits from the use of labour subcontracting, but this system has adverse consequences for workers, companies, the industry and Human Resource functions.

In case of the strategic involvement, the construction companies can take up the Strategic Human Resource Management policies to fulfill their long term perspectives. In the day to day operations, there is also a need for the organization to take great care to balance organizational and individual needs of the employees' in-order to successfully fulfill the strategic needs. But the biggest issue is the trend amongst the Industrialists to bestow the responsibilities of all the operations to line managers instead of Strategic Human Resource Management (SHRM). Hereby, SHRM looses all the control and rely on the policies and practices of autonomous line managers. Hereby, line managers have the role to balance their staff needs to those of the organization.

The main feature of Construction Industry is its inherent ability to adhere to the outside forces that exerts a powerful force on its everyday growth. Here also Human Resource Management strategy comes into play whereby it capitalizes the opportunities and mitigates the threats through their management policies. For e.g. a company captured an opportunity in a government sponsored infrastructure project coming in next five years. And it needs more skilled labor for heavy civil engineering work but has extra labor for general building construction. By utilizing the human Management Resource it can proactively retrain its managers and operatives with the requisite skills and exploit the new market opportunities.

Human Resource Management develops strategy according to the labor market situation in which it is operating. The practice of the manual labor in the construction industry performs according to the ‘hard models’ of Human Resource Management whereas non-manual employment goes more according to the conditions of 'soft' HRM models. According to John Storey, Human Resource Management works according to the relations to the performance on line management responsibility, performance management, and values and beliefs of personnel managers.
A dynamic manager balances two sets of forces: the firm’s external advantages on one hand and its internal strengths and weaknesses on the other and here the Importance of Human Resource Management cannot be ignored.

Thus the human resource planning in the decision making process ensures that enough competent people with appropriate skills can be able to perform jobs where and when they will be needed. As such, "it enable us to define the organization's need and assessing the available pool of people to determine the best fit."'

The most serious implication that Environmental and Market forces can inflict on the Construction Industry is an on-going shortage of skilled workers including large number of retirements, creates necessity to provide Human Resource Management strategies .Then dependent on immigrant workers, the problems of reimbursing the wages and to benefits to attract labor force and to keep within the financial constraints of current market forces. There has been a very little and systematic research on the labor force, even fewer studies that address the problems being faced by the labor force.

The behavioral science approach is adopted as measure for human resource development. Some emphasis on interpersonal behavior focusing on the individual as a socio-psychological being; others emphasize on group behavior subject to their attitudes, habits, pressures and conflicts. The role involves the formulation of concepts and explanations about individual and group behavior, the empirical testing of these concepts in many different experimental and field settings, and the establishment of actual managerial policies and decisions.
The process of manpower planning involves Determining the objectives of man power planning, preparation of current man power inventory, Demand forecasting, supply forecasting, Estimation of the man power requirements, Making an action plan for redeployment and redundancy, determining jobs requirements of the jobs to be filled, Employment plan, Training and development plan.

Thus Human Resource Planning in Construction Industry will always work if implemented constructively. But there are certain disadvantages too in following Human Resource Planning like there is generally an identity crises and many managers as well as human resource specialists are not able to comprehend the rationale or purpose of human resource planning and unless the human resource planners undertakes the strong commitment and purpose they are most likely to face in the diverse structure of Construction Industry. In the long run, the human resource management should have the support of Top Management, otherwise it will be ineffective. To get the success human resource management should be slowly and expand gradually otherwise it is bound to fail in the Construction Industry. To best achieve the target it is very essential to bridge the gap between the present resources and future needs. The future action should be appropriately planned for keeping the labor force into a competitive spirit.


Published: 2006-12-24
Author: Suneet Kaur

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I am freelance writer and writing for websites. I also would like to contribute for your organization.

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Banit Madan

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