Retaining engineering contractors in a competitive market

How can companies retain good talent in a competitive environment? We look at the most in-demand roles and share some tips for businesses to hold on to the best contactors once they find them.

The current buoyancy in the engineering and construction industry is putting contractors firmly in the driving seat. According to Deloitte, the industry “responded very well during the pandemic and has come out strong in the recovery period”. As a result, demand for contract talent is extremely high. They frequently receive multiple job offers, which makes retaining good people difficult. So, what can organisations do to hold on to the best talent? We explore everything from contract lengths to hybrid working opportunities for some top takeaways.

The current landscape

Christopher Sendall, Sales Team Manager in Progressive’s power and energy team, says much of the competition for engineering contractors is down to “projects being at a bottleneck”. Prior to 2022, most companies within the engineering sector experienced “18 months of not being able to deliver projects”, with contractors not allowed on site to do their jobs. These delays have caused the current influx, he explains, adding that the 2019, 2020 and 2021 tenders are now all coming home to roost.

Most in-demand roles

In an environment with a lot of work on offer, there are still some engineering roles more sought-after than others. For Sendall, at present it is site managers and design engineers.

For site managers this is because they can’t do the job without certain qualifications and need to be authorised by the relevant distribution network operator (DNO). Because of this, the barrier to entry is higher and the pool is smaller, therefore making those holding the right qualifications in very high demand.

When it comes to design engineers, Sendall says he’s placed many candidates in these roles in the past 12 months. He believes the reason they’re so sought after is partly due design roles being flexible, and individuals able to work for multiple customer types.

In general, Sendall says neither role has seen the “IR35 pinch” experienced by other engineering roles. Indeed, according to People Management successfully handling IR35 is key to “winning the war on talent”. It says: “As companies struggle to recruit, and the number of contractors decreases because of IR35 tax rules, many businesses are missing out on a major opportunity to attract the best talent by failing to embrace IR35 proactively.” Therefore, roles that tend to be less affected by the off-payroll working rules are more alluring. Although the government recently revealed plans to repeal the 2017 and 2021 IR35 reforms at the start of the next financial year, there are still some months to go.

Talent retention tips

The number one question is how companies can keep hold of the best talent once they’re contracting with them. Here are some of Sendall’s top tips:

  • Extend notice periods – being open to extending workers’ notice periods is key to retaining the best engineering contractors. Clients who don’t extend notice periods lose contract engineers. So, what would be the right contract level to give? Six- or nine-month contracts give people the security they need.

  • Take on local talent – take locality into account. Bringing on local talent is beneficial for businesses in two ways: it can be more cost effective but also make it more likely the contractor will stay working with the company because it is convenient.

  • Create a good work culture – this isn’t just important for full-time workers; as the HR Dive notes, company culture is becoming much more of a priority for contract workers. Making them feel as involved and connected as permanent staff could help businesses to retain them.
  • Offer hybrid working where possible – although this can’t apply to all roles, clients who offer hybrid working tend to be more successful at keeping hold of talent, particularly for such roles as planning engineers and design engineers – since these people don’t always need to be on site. “Allowing them to work from home on some days goes a long way,” says Sendall. While it is a balancing act for employers, it is important to listen to a contractor’s needs and try to be amiable about how best to meet these.

Future forecasting

With a recession looking increasingly likely, this could impact contract engineering roles, warns Sendall. However, the effects on the sector might not be as simple to identify. A recession could mean “candidates are less likely to move jobs if they have a long contract,” says Sendall – favouring job security over a change in roles and new opportunities. This might make the engineering landscape like it was during Covid-19.

For support sourcing the best specialist talent for last-minute project needs, talk to one of our consultants today.

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