Construction Accounting Article -
Cross-training Saves Contractor Money, Worry

Target Audience: Construction Industry Professionals, Commercial Construction Businesses, Contractors, Baby Boomers, Seasoned Employees, Financial Advisement Interest, Craft Employees, Construction Accountant Advisement Interest

A contractor with a commercial construction business in a sizable metropolitan area was concerned. Many of his seasoned employees were baby boomers who would be ready to retire in a few years, and there weren’t enough younger workers entering the field to take their places. In addition, stricter immigration laws and deportation policies were making it harder to find workers with even basic skills.

Discussing the situation with his financial advisors who specialized in construction accounting, the contractor wondered how he was going to stay on top of things while he was finding new employees and waiting for them to get the experience they needed to pull their full weight. The two recognized that perhaps the most cost-effective option was to cross-train existing “craft” employees (such as electrical or carpentry staff).

Cross-training not only would extend the contractor’s workforce, but could also save significant amounts of money. In fact, every dollar construction companies spend on craft training can yield from $1.30 to $3 in benefits, according to a study by the Construction Industry Institute released earlier this year. Respondents reported increased productivity and reduced absenteeism, turnover and rework.

Cross-training would also enable the contractor to use workers where they’re needed. A journeyman carpenter who acquires electrical skills, for example, could do carpentry work at a site one day and help run electrical lines at another site the next. There’s no downtime — for the worker or on the jobs.

There is also no need for every journeyman carpenter to become a master in another area. But if workers can acquire basic-or-better skills in another discipline, they can contribute more to the overall process. Additionally, the extra training may encourage them to remain in the industry, because it’s likely to lead to higher wages — a concept that could also help attract new employees and retain valued existing ones.

Of course, there are limits to the number of skills each worker can absorb, and using cross-trained workers to your advantage can require additional managerial time and attention. Still, these employees can be valuable additions to your workforce.

In this case, the contractor discovered that cross-training enabled him to finish two jobs with fewer people and less downtime than in the past. That looked good on the bottom line and eased his worries about the future just a bit.

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