Article on Skills Shortages

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Skill shortages, recruitment and retention in the house building sector Linda Clarke and Georg Herrmann
Westminster Business School, University of Westminster, London, UK Abstract
Purpose – The purpose of this paper is to show how internal and external labour markets operate in the construction sector, associated with different strategies taken by firms in recruiting and retaining particular groups of employees. It draws on research of the house building sector which aims to discover how far firms develop human resource policies, recruitment and retention strategies, and training and development activities in response to skill shortages. Design/methodology/approach – The paper is based on a questionnaire survey of skills shortages, recruitment and retention in house building firms, drawn from databases of social and private housebuilders and a detailed investigation of firms. Findings – The results show worsening skill shortages and hard-to-fill vacancies, particularly for site managers and tradespersons. These shortages are especially bad for house building firms, above all those with higher levels of direct employment in the social housing sector. Despite this, firms rely for operative recruitment on traditional and informal methods and procedures, on experience – not qualifications – as the main criterion, and on “poaching” – all symptomatic of a craft labour market. For managers, there is some evidence of retention measures, in particular through training and promotion, implying the development of internal labour markets. And for professionals there are indications of occupational labour markets with their dependence on institutionalised systems of training and qualifications. Originality/value – The paper shows that firms take little responsibility themselves for resolving skill shortages and establishing training needs, though national training policy is reactive and driven by employer demand. Obligatory skills certification and an institutionalised industrial training system would facilitate a move from this deadlocked situation, from craft to occupational labour markets. Keywords Skills, Recruitment, Retention, Construction industry Paper type Research paper

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Introduction This paper is about recruitment and retention in the construction industry. Drawing on a large-scale survey of firms active in house building and a detailed survey of construction firms it shows how, despite acute skill shortages experienced by the majority of firms, traditional and often informal methods and procedures predominate. The considerably greater recruitment difficulties experienced by firms involved in social housing and with at the same time higher levels of direct employment of operatives points, however, to clear disparities in the nature of the labour market. Our paper seeks to illustrate these and highlight their implication for the recruitment and retention of staff and operatives. Many firms in our survey conform to what Marsden has termed a “production approach” whereby skills tend to be firm-specific and training depends to a large extent on the individual employer and on on-the-job learning (Marsden, 1999). In terms of labour market structure and theory, such firms would be expected to rely on internal labour

Personnel Review Vol. 36 No. 4, 2007 pp. 509-527 q Emerald Group Publishing Limited 0048-3486 DOI 10.1108/00483480710752777

PR 36,4

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markets, characterised by mobility between jobs within the same firm, which is at the same time highly structured internally in its grades and hierarchies. With such markets, therefore, employers regularly fill vacancies from their current employees rather than from external recruitment and processes of skill formation depend on predictable job structures (Kalleberg et al., 1996). Such “firm internal markets” are apparent from our survey, in particular for...
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