A new analysis published in Issue 2 of ADP Research's Today at Work 2025 report analyzed five years of ADP payroll data to uncover employee turnover trends.
Timely, ADP Research found employee turnover jumps in the summer months of June, July and August to 3.56%. By comparison, turnover in the non-summer months sits at 3.14%.
How does employee turnover look for the construction industry specifically? In the non-summer months, the construction turnover rate is 3.29%, the 4th highest of 13 industries analyzed. In the summer months, construction turnover hits 3.69%, once again 4th highest of 13 industries.
When one considers both the high demand and limited supply of construction workers, retention difficulties in the industry are easy to understand. Competition is fierce and if you're not laser focused on retaining your construction crew, someone else is going to swoop in with a better offer.
For construction businesses, retention should be a core pillar of their talent strategy. Retaining the workers you already have is oftentimes more affordable than replacing them. Moreover, losing workers also means you lose their institutional knowledge of how your business operates to maximize efficiency. Even after you hire a replacement, building back up that institutional knowledge can take years.
Finally, a crew that sticks together becomes a well-oiled machine. They work in harmony, enabling projects to get done quicker without losing quality. This type of chemistry not only helps with the company's bottom line, but it enhances the company culture and makes the work more enjoyable.
When it comes to increasing retention at your construction company, offering competitive pay and benefits, prioritizing skills development, utilizing modern performance management solutions and focusing on recognition are four key strategies to consider.
Offering Competitive Pay and Benefits
The nuts and bolts of any talent strategy.
We all want great pay and benefits. It's why we work. And it’s why we stick with an employer if they're staying ahead of what the competition can offer.
How do you know if your pay and benefits are beating the competition? Having access to robust compensation and benefits benchmarking data is immensely helpful. This type of data can tell you what other construction companies are offering according to factors like role and location.
Having confidence that your construction crew is getting top-of-the-market pay and benefits via benchmarking data can provide confidence that your crew is going to stick together. For reference, according to the most recent ADP Pay Insights report, which captures nearly 14.8 million individual pay change observations each month, construction employees saw year-over-year pay growth of 4.5% in July. The median pay was $70,400.
When it comes to benefits specifically, pay attention to what your team is looking for. In today's world of work, where six generations are working together, benefit priorities can vary greatly. Because of the multi-generational workforce, not having a "one-size-fits-all benefits plan" can be a huge advantage.
Instead, ensuring your workforce has flexibility in being able to choose the benefits that work best for their unique situation is key.
Younger crew members might want things like paid Days of Service or access to financial literacy courses that can provide education on things like investing or homebuying. Older colleagues might prioritize extended parental leave or childcare benefits. Other benefits like pet insurance or mental health counseling are often of interest across generations.
If you are looking to increase retention at your construction organization, start with pay and benefits.
Prioritizing Skills Development
A previous report from ADP Research found workers who feel strongly their employer is providing the training they need are nearly 6 times more likely to recommend their company as a great place to work and 3.3 times more likely to describe themselves as highly productive.
Moreover, when workers who are confident in their skills believe their employers are investing in them, they're twice as likely to say they have no intent of leaving their organization compared to workers who are confident in their skills but lack on-the-job training.
When ADP Research's survey respondents were asked to provide the top reasons they would stay with an employer, the opportunity for career advancement was second only to scheduling flexibility.
So, with its clear ties to retention, how are construction companies faring on skills development?
ADP Research found 25% of construction workers strongly agree they have the skills needed to advance their career, while 18% strongly agree their employer invests in the skills they need to advance their career.
For construction organizations, there's room to improve skills development.
Having access to the right talent management solutions can be a huge help when it comes to developing a skills development program for your employees.
In addition to leveraging workforce technology, talk to your employees. What skills are they looking to add? Where do they see themselves in 3, 5 and 10 years and what skills do they need to get there? Are they interested in any stretch projects that can provide new skills through real-world experience?
Utilizing Modern Performance Management Solutions
In today's ultra-competitive world of construction work, keeping a constant pulse on your construction crew is imperative to increase retention.
Losing track of the performance and engagement of your employees, even if just for a few weeks, can be enough time for them to quit or find a new opportunity elsewhere.
Modern performance management solutions can go a long way towards optimizing each unique employee experience, which can boost retention. Utilize a workforce tool that facilitates regular check-ins with your workers so that you begin tracking their engagement on a weekly basis.
The right tool can also track what employees loved and loathed at work. If you are seeing consistent loves, how can you provide more of this work to them to maximize their enjoyment and fulfillment at work.
If you're seeing consistent loathes, how can you move them away from this work? Catching a loathe early can enable you to remove that type of work from their plate as soon as possible before it festers into a retention problem.
Similarly, tracking engagement on a week-to-week basis greatly increases your ability to catch waning engagement as early as possible and course correct.
Today's workforce requires modern performance management solutions that provide employee engagement data as frequently as possible to optimize the employee experience and increase retention.
Focusing on Recognition
Finally, ensuring your construction business has a healthy culture of recognition is another key retention strategy.
Recognize the team wins and the individual wins. Recognize publicly but also recognize one on one.
Recognizing your construction workers for great work and tying it back to how it helped the business gives them a sense of belonging and purpose. It can be a great motivator to continue that level of work. It also demonstrates to your workers that you are appreciative of their work and value their contributions.
Recognition can also help the team understand what's expected of them, and clear expectations help workers get more productive and focused.
Keepingiyour construction crew retained will help keep your construction business humming. Through institutional knowledge, chemistry and eliminating recruitment costs, the return-on-investment of retention is also immense.
There are numerous ways to increase retention, but these four strategies can be great pillars to build your strategy.
