Hey, look who's back!
Christmas came early for...well...whomever is a proponent of OSHA's Emergency Technical Standard (ETS) for vaccine mandates.
Quick disclaimer. At Road Dog Jobs we don't write about medical advice. We don't write about political implications.
We talk construction labor, and today we're just looking at how the re-established ETS will impact the construction labor market - and what you can be doing about it.
We should also note that litigation around the ETS is far from over.
Several hurdles remain including the possibility of the Supreme Court reinstating the stay in the near term.
Regardless, if you haven't really looked at the impact of the ETS and how to deal with it, now is the time.
The impact on construction will be greater than most industries.
As an industry construction's vaccination rates lag the general public. This means that about half the workforce is going to need to be tested on a weekly basis.
The qualifier here is that the mandate only applies to companies with over 100 employees.
There are about 867,000 construction companies in the United States. With employment at about 7.5 million people, the average construction company has 8.7 employees.
So there will be also lots of construction companies that will not meet the 100 employee level required to implement the mandate.
If you're one of these companies below 100 employees and you have decided not to implement the vaccine mandate and testing, this could be seen as advantage for you.
There will be lots of people in the workforce who will see these non-mandate, non-testing jobs positively and it may just open up more labor to your jobs.
For those companies with over 100 employees, however, things could get interesting.
What happens to labor availability?
We know that labor is going to be scarce as we head into 2022. We're at record lows for the number of available tradesmen in the industry.
The ETS will further complicate the labor situation.
The biggest labor challenge will be for any company or site owner that has decided mandate the vaccine without the testing option.
These companies and sites are in the red zone for labor availability challenges and will need to keep pay rates high to compensate.
For the sites that will allow testing, the ETS will be still a short term disruptor in the best case scenario.
The testing will be disruptive and lead to disputes on sites that otherwise would have never materialized - and we expect that turnover will be higher during the ETS implementation period.
Keep in mind that the ETS in its current iteration will be up for re-evaluation in April. At this time OSHA will decide to extend the ETS for 6 months, withdraw it, or make it permanent.
We'll leave it to you to decide which scenario to plan for. Here's a hint, though - if the courts don't throw this out, OSHA sure won't either.
What to do about it?
Managing labor in 2022 will require a different skill set. It will require more detailed planning for availability challenges and higher turnover.
The companies that win in 2022 will build more contingencies into their labor planning.
1. Check your pay rates. Are you competitive with the industry? You can reach out to us and we can help you figure that out. Low pay rates are going to be the first projects to get hit by labor availability challenges.
2. Hire more people than you'll need. Competition for people will be fierce. People will get job offers and no show and the last minute. Or they'll hear about higher pay down the street and drag up. Get ahead of these problems by building a margin of error into your hiring plans.
3. Plan your testing program. Nothing frustrates people more than a disorganized, poorly planned, chaotic scene that makes getting on site difficult. The better planned your testing, the better you'll mitigate turnover issues.
Communicate to your people, pay them right, plan ahead and you'll put yourself in a good position for 2022. We'll have more info and analysis coming as this situation develops.