A shortage of skilled labor is perhaps the biggest problem facing construction contractors. Lousy pay and even lousier prestige conspire with unfavorable demographics to repel talented young people from the trades. This makes it devilishly hard to hire top-notch workers.

If you don't feel that's the biggest problem, it probably comes in second to the one that bugs you the most, which would then be the proliferation of bottom-feeding competition everywhere you look. Too many contractors are superb with tools and shop drawings in their hands but clueless with a balance sheet. Their lack of business sense makes it impossible for them to prosper and harder than it ought to be for those of you who do know how to run a business.

You might notice a certain irony in these two scenarios. On the one hand, you suffer a shortage of skilled trade workers, on the other, too many skilled workers are out there operating as independent contractors. Wouldn't it solve a bunch of problems if only you could recruit some of your impoverished competitors to work for you? Wouldn't most of them be better off working fewer hours with larger and steadier paychecks?

This is such an obvious solution it makes you wonder why it doesn't happen more than it does. Why don't more struggling contractors give it up and go to work for owners who would take better care of them than they are able to do themselves?

The e-myth

The myth is widespread that contractors are a bunch of hard-driven entrepreneurs who could never work for anyone but themselves. Certainly, that describes some but it doesn't apply to all of them. My guess is that the majority of contractors went into business for themselves for reasons other than a consuming ambition to run their own business.

The most common reason, of course, is that they think they can make more money working for themselves. As I've addressed in several past articles, this usually turns out to be an illusion. No matter how skilled trade workers might be, they'll usually find themselves working longer hours for less pay if they start a business without a lick of business sense.

Another common reason contractors say they go into business for themselves is job security. They get tired of the layoff cycles that attend construction work and figure nobody can fire them if they own the business.

However, I think the pay and security issues often disguise the real underlying reason so many craft workers break off on their own. That is the fact that they've been mistreated by most of the bosses and owners they've worked for. Treat an employee like garbage and presto, he becomes a competitor. Ever wonder why you have so many competitors?

The people business

People skills are a critical shortcoming in construction work. Think of all the foremen, superintendents, contractors and any other bosses you've encountered in your career, and try to recall how many of them have had any formal supervisory training. I wouldn't be surprised if many of you can't think of a single one.

You wouldn't think of putting anyone in charge of a work crew who didn't have a clue about how to operate the tools and equipment of your trade. Well, humans are the most complex machines around. Yet, it's common for contractors to put one human in charge of others without a minute of instruction on how to go about it. Most big businesses wouldn't think of putting someone in charge without some management training. In construction, the guy who wields the tools the best tends to be the guy who ends up in charge of a crew. Often, his supervisory skills are judged by how willing he is to "kick tail" to get the job done.

That's why supervision in the construction industry usually boils down to the philosophy expressed by the following statements:

"It's my way or the highway."

"I may not always be right but I'm always the boss."

"Keep messing up and I'll bleepety bleep your sorry bleep to kingdom come!"

In the short run, this Neanderthal approach might even prove effective in bringing a job or two in under budget. But let's not lose sight of the main theme of this article: why talented people keep opening their own shops. In the long run, cave-man supervision drives people away. It turns an asset-a skilled worker-into a debit, i.e., a clueless competitor.

So what can you do about it? Sending supervisors to people management classes and seminars is not at all a bad thing to do but most of you would plead the lack of time and money to do that.

Fortunately, even in the absence of formal training, there is a simple people management program available to everyone that can be easily implemented at a moment's notice. What's more, it's free.

A moral imperative

It's called The Golden Rule and we all ought to know it by rote: Do unto others as you would have them do unto you. In a pinch, TGR can substitute for formal management training. In fact, be wary of any management system that doesn't have it as a core value.

TGR comes from the New Testament but one doesn't have to be a Christian to recognize its wisdom. No matter what the job might be, you get better performance out of people by treating them well rather than by kicking tail. If you want academic studies to verify that, spend a little time searching the Internet and you'll find plenty of research showing that you get better results with positive than negative motivational techniques.

But if you want to save time, just think of it as common sense. And, think of it as the right thing to do.

It's unfashionable nowadays to speak of morality. It makes many people uncomfortable, especially in the business world, where it is hard enough mustering the cleverness to prosper, much less worry about doing the right thing along the way. The beautiful thing about TGR is it serves double-duty as a moral imperative and profit-generating business principle.

TGR says that when any question arises about how to deal with a person, ask yourself how you would want to be treated in the same circumstance. TGR says you have a responsibility to give fair value to customers in return for the money they pay you and that you must pay bills on time for those who do the same to you. Do that and people will enjoy buying from and selling to you. TGR also holds you responsible for providing fair pay and benefits to the people who work for you, as well as treating them in a dignified manner. After more than a quarter century as a trade journalist, I find an almost perfect correlation between those businesses that prosper over a long period of time, and those that practice TGR as a management principle.

Pretty simple yet all too often ignored. As a result, you are left to deal with a trickle of skilled workers and a flood of incompetent competitors. The failure to abide by simple and obvious TGR seems to explain the reason for this better than anything else.

It's time to do some soul searching to figure out whether you've been practicing TGR. And if not, correct this management and moral deficiency without delay.