With over 14 years of experience in supporting customers in the construction industry by finding and retaining best-in-class contract management and claims talent, the market and companies are under significant pressure to bring in the right people, and for this, there are a number of key reasons.
Despite the economic and political turbulence, the global construction market is growing, and the trend looks set to continue. Governments are continually recognizing the importance of infrastructure development for economic growth, emerging economies are experiencing rapid growth, and this is all in the backdrop of urbanization and population growth. All, and more, are driving the future of the global construction market.
Global Construction Futures have sighted some of the following key forecasts for all major construction markets globally:
Construction work complete up from US$9.7 trillion in 2022 to US$13.9 trillion in 2037—driven by superpower construction markets China, the US and India.
Growth globally is driven by huge opportunities in the global green economy.
India is forecast to be the fastest-growing construction superpower.
UK set to be fastest growing for construction work done in Western Europe.
As the demand for global infrastructure increases, projects are increasing in size and value, and therefore so are the challenges they face and the complexity of the problems they need to solve. Therefore, finding contract managers in the construction industry can sometimes be challenging due to several factors but never more so than those we are facing today:
Specific Skill Set: Contract management means many different things to many different people. In the construction industry requires a unique combination of skills, knowledge, and education. Contract managers need to have a strong understanding of construction contracts, legal implications, risk management, and negotiation skills. The specialized nature of these skills makes it more difficult to find qualified candidates. The required experience demanded in today’s market further emphasizes this. For example, the Contract Managers with knowledge of Covid or Pandemic related claims.
High Demand: The construction industry is known for its cyclical nature, with periods of high demand for construction projects. During these peak periods, the need for contract managers also increases, leading to a competitive market for experienced professionals. The demand-supply gap can make it harder to find suitable candidates. There is no better example of this than in the Australian construction market where we have seen a record number of infrastructure mega-projects awarded including the $11bn AUS North East Rail Link in Melbourne and the $5bn AUD STTOM project in Sydney to name but a few. With an influx of international contractors in the local market with a specific approach to contract management on projects, the demand for talent far outweighs the available talent pool. With the limited talent available in-country, companies are now having to recruit internationally or find new ways to integrate and/or nurture local candidates into their processes and methods.
Industry Experience: Construction projects often involve complex contracts, compliance requirements, and industry-specific regulations. Employers in the construction industry often prefer candidates with most of their experience in contract management alone. Furthermore, they will have come from a quantity surveying, engineering, or technical background. Whilst many contract managers come from a legal or even economic education, without necessary and first-hand site experience, they often lack the technical understanding to give relevant and relatable advice. The limited pool of individuals with this specific on-site industry experience can make the recruitment process more challenging.
Retention Challenges: Retaining contract managers in the construction industry can be difficult. Construction projects typically have fixed timelines, and contract managers may need to move from project to project, making it challenging for companies to provide long-term career opportunities. And without a robust workforce planning process, it can mean that talent that is invested in and trained, can be lost to competitors. Thus, leaving businesses to start over again. This turnover can create a constant demand for new contract managers, which increases costs, and consequently can have a negative impact on the quality and consistency of a company’s contract management function.
Geographic Factors: The availability of contract managers can also vary based on geographic location. Some regions or markets may have a shortage of qualified professionals, while others may have a more abundant talent pool. Factors such as local construction activity levels, infrastructure development, construction regulations, and access to relevant education can influence the availability of contract managers in a specific geography.
To overcome these challenges, companies might consider the following strategies:
Broaden the Talent Pool: Look for candidates outside of traditional strongholds. For example, the UK has long been the gold standard when it comes to technical contract managers and many companies target candidates who have been educated within this system. But, with the improvement of online education and courses, as well as global mobility, countries including (but not limited to) India and Pakistan can give access to skilled and qualified talent. Companies might also consider talent with transferable skills and experience in related fields, such as engineering or project management. By providing training and development opportunities to help individuals transition into the role of contract manager, they could adapt and potentially bring new value to the position through their past experience.
Partner with Specialist Recruitment Agencies or Talent Advisors: Collaborate with specialized recruitment agencies and/or talent advisors that have expertise in the construction industry specifically within contract management, claims, and disputes. They can help identify qualified contract managers, build a relevant and engaged network and talent pool, and streamline the hiring process. Furthermore, they see the market from both ends of the spectrum (the candidate and the client) and are well-placed to advise on candidate behaviour, market conditions, workforce planning, and a relevant process and structure.
Professional Networking: Attend industry events, join professional associations such as the Dispute Resolution Board Foundation (DRBF), and participate in online forums to connect with contract managers and leaders in the construction industry. Networking can help you tap into a broader pool of potential candidates and build relationships for future hiring needs.
Offer Competitive Compensation & Benefits: To attract and retain contract managers, ensure that your compensation packages are competitive within the industry. Consider offering additional incentives, such as performance-based bonuses or opportunities for career advancement. It is natural that any employer would want a potential employee to join them for the ‘right’ reasons. But to ignore economic market conditions can be detrimental to your talent attraction policy. The quality of candidates will suffer, this will slow down the hiring process leaving projects commercially and contractually exposed, and at worst the wrong hire could potentially cost the company millions if not more. Furthermore, if a challenging claim or dispute were to arise and they were not equipped or skilled enough to handle it could costly to the project and impact the company’s future relationship with a client, country, or region.
Develop Internal Talent: Identify high-potential employees within your organization and provide them with opportunities to develop contract management and leadership skills. This can help you groom and retain contract managers from within the company. Invest in talent at the early stages. Consider building relationships and partnerships with universities, lecture for them, champion relevant contract management courses, and build an engaged student network that will pipeline into your business with the intention of following the career path of a contract manager. Creating talent from within can be one of an organization’s greatest assets.
To conclude, by implementing these strategies, organizations can improve their chances of finding and retaining qualified contract managers in the construction industry and meet their project needs effectively. Processes, systems, and relevant partners are key to success. Ultimately, the goal is that an effective and robust contract management function should increase profitability not just on projects but also within the wider business.
For more information or insights into the global contract management and claims industry, please reach out to Director, John Murphy at firstname.lastname@example.org or +44 7842 963 431.