In May of 2018, Barnes Dennig, North Side Bank, and USI Insurance revealed the results of their biennial Construction Compensation and Benefits Benchmark Study. At a time when many contractors are stretched thinned for labor, growing rapidly, and have seemingly more work than they know what to do with, construction leaders took the morning to hear what the study and speakers had to say about the industry.
Economic Trends Point to Continued Growth
The March 2018 Architecture Billings Index reported an index of 51.0, which indicates that billings have increased from the previous period. A score of 50 indicates no change, while a score above 50 indicates an increase in billings. More specifically, the Midwest region which includes Ohio and Indiana had an index of 50.7, with the South and West leading the country at 53.2 and 53.4, respectively. With unemployment at a nearly 20 year low for Ohio, Kentucky, Indiana, and the United States, and revenue and bidding activity at levels not seen in a decade, the importance of hiring and retaining qualified skilled labor and management is crucial.
A Recording Breaking Benchmarking Study
The 2018 Construction Compensation and Benefits Benchmark Study was a record-breaking study, with 67 participants. These participants were spread fairly evenly between specialty trade and general contractors. The majority of respondents (77%) have annual sales between $10 and $100 million, and almost all respondents (94%) had over 25 employees, with nearly equal distribution between the 25-50, 51-100, 101-200, and 200+ categories. Most respondents identify as commercial contractors, but residential, civil, and institutional were also represented. Finally, most identified as working in the Greater Cincinnati, Northern Kentucky, Tri-State Area, while some perform work in the Midwest or Nationally.
Survey Trends Highlight Key Challenges
Not surprisingly, 91% of respondents indicated that they expect future employee levels to remain the same or increase. The same percentage also expect revenue to increase from 2017 to 2018. One of the greatest challenges we see in the construction industry is firms growing wisely and profitably. Labor is often the key to achieving wise and profitable growth. Forming the proper compensation strategy is a key to attracting and retaining top talent.
The study also contains detailed pay information for 13 positions, broken out by type of contractor and size of contractor. Other benefit information is also included. Stay tuned to our blog for more information from the study.
If you were unable to attend the presentation and would like more information, including a copy of the study, you can request a copy of the recording of the event and the report here.