Business Insider

When construction wanes, builders should have a personnel plan

It seems like Downtown Boise is one big construction project. Commercial construction is booming, but we are never sure it will continue.

Construction 101 classes will tell you to develop construction-management staffing plans. These plans coordinate suppliers, facility managers, architects, quality control and more. Communication links are clearly outlined.

The plans typically focus on what it takes to get a particular job done. A plan often does not go into big possible changes in the contractor organization as a result of an upturn or downturn in the construction economy.

A staffing plan should have at least an addendum to plan for the ups and downs. The key is to plan for staff flexibility.

When construction grows, a staffing plan addendum can describe alternatives to reduce staff shortages to provide management accessible options. The no-brainer solution to economic instability for most of the construction industry is to hire consultants who are not regular employees, who have expertise on a subject, and who probably are easy to cut when the business slumps. Engineering and construction school graduates, apprenticeship programs, internship programs, unsolicited applicants, consulting organizations and even professional associations also should be available. Keep a separate file of names and programs.

Think of existing employees who can fill needed spots in succession plans. Employees can rotate jobs to enhance their availability for promotions.

When construction slows, the rotated employees might be able to fill needs to keep their jobs.

If downsizing plans in a staffing document are not politically feasible, at least create a separate file with downsizing priorities, alternatives to downsizing, and ways to communicate with downsized staff and survivors.

Downsizing tends not to work. You lose corporate memory, and survivor culture is damaged.

The most successful downsizing result is cutting costs. That works only about half the time. Prioritize some alternatives such as job sharing, reducing work hours, using furloughs, canceling business trips and other costly perks, cutting salaries of top management (a 100 percent ridiculous, revolutionary thought), freezing or reducing hiring, reducing pay raises and scaling down employee events.

Construction industry economic shocks are inevitable. You might as well try to plan for them.

Gundars Kaupins is a professor of management in the College of Business and Economics at Boise State University. This column appears in the June 15-July 18, 2016, edition of the Idaho Statesman’s Business Insider magazine as part of a special section on commercial construction.