Small construction businesses in rural areas in the Highlands and Islands often face unique challenges when it comes to increasing capacity to meet demand, with skill shortages being one of the most pressing. In this article, we'll explore effective strategies for overcoming these obstacles and achieving long-term success. 

The shortage of skilled labour is a major challenge for small and medium-sized enterprises (SMEs) operating in the Highlands and Islands. 

According to collocated research by Skills Development Scotland, there will be a need to replace 82,700 people who have left the labour market in the Highlands and Islands region over the next 10 years. This shortage is limiting the growth and competitiveness of companies and impacting the economic development of local communities.  

However, there is a huge labour demand problem right now across every sector. It's not just construction – it's call centres, it's medical, it's aerospace – with 44.5% of Scottish businesses experiencing a shortage of workers. For construction, one part of this challenge is the pipeline as there is still a lack of new young people coming into construction.  

To combat this on a broader level, one of the first things we need to do is to stop talking negatively about construction as a sector and encourage young people to come and work in the industry. We need to get in at the educational level of schools and colleges and change the way we speak to our children about working in construction. From a rural perspective, we need to attract people to stay in rural communities and attract people to come to rural communities. Skills and training initiatives help here, but it's actually people who are at the heart of this conversation. People’s decisions on where they live, where they work, and what they do, so addressing this is crucial. 

And this does mean that this broader scale challenge can also be tackled at an individual level. Let’s explore some of the strategies that SMEs can use to overcome challenges in skills shortages.

 

1. Focus on employee retention 

Start with people, and the people you already have are your biggest asset. One of the biggest challenges facing small companies in rural areas is the need to retain valuable employees as they move onto pastures new. To do this, companies must create a positive workplace that values and invests in employees.  

Companies must bring value to employees and meet their needs. This means offering competitive compensation and benefits, providing opportunities for professional development and advancement, and fostering a supportive and inclusive workplace environment. This is especially important for SMEs that are competing with larger companies for workers. 

To start in this area, conduct employee surveys to identify areas for improvement in workplace culture. Work to implement changes that address these issues, like offering flexible work arrangements, providing opportunities for growth and development, and creating a strong sense of community within the workplace. Also conduct leaving interviews to identify reasons for employee departure in the case that someone does leave. By investing in employees and creating a positive work environment, small companies will attract and retain more talented and committed workers. 

 

2. Build partnerships with educational institutions 

Small companies in rural areas can also establish partnerships with local educational institutions to offer apprenticeships, internships, and other training opportunities that develop the skills and expertise needed. By working with educational institutions, companies can tap into a pool of potential talent and develop a pipeline of skilled workers that they can draw from over time. These partnerships can also help to bridge the gap between education and employment, providing students with hands-on experience and real-world skills that are directly applicable to their future careers. This can also help to reduce the dependence on workers from outside the area. 

Reach out to local schools and colleges to explore partnership opportunities. They can offer to host job shadowing programs, provide internships or apprenticeships, or sponsor educational events that promote construction industry pathways. By becoming a valuable partner in the community, small companies can help to attract young people to the industry and build a strong talent pipeline for their company. 

 

3. Leverage technology 

Technology can be a powerful tool for small companies in rural areas looking to increase their capacity and meet demand despite skill shortages. By investing in software and equipment that improve efficiency and productivity, companies can reduce their reliance on additional staff and streamline their operations. 

To implement this, start by identifying areas where technology can be used to improve operations. This might include investing in construction software that helps to automate and streamline processes, or purchasing heavy machinery that can perform tasks more efficiently than pure manual labour, such as 7-22 Systems recently did. By leveraging technology in these ways, small companies can increase their capacity and productivity without having to hire additional staff. 

 

The shortage of skilled labour in rural areas is a major challenge for SMEs, but it is possible to overcome this challenge through strategic planning and action. By partnering with local education and training institutions, offering on-the-job training, providing flexible working arrangements, utilizing technology, and offering competitive compensation and benefits, SMEs can ensure that they have the skilled workers they need to grow and succeed.