- Even more than two years after COVID-19’s emergence, the equipment rental and construction companies are still grappling with the pandemic’s impact on supply chain’s and available labor
- As a result, it’s imperative for rental and construction companies to do more with less in order to continue to suceed as market conditions begin to return to what they once were
- With the help of the right software, rental and construction companies can delegate work more efficiently, enabling their departments to be more productive without having to increase head count
The U.S. Bureau of Labor Statistics announced that there were 11.5 million job openings in March 2022. This may be good news for job seekers, but this labor shortage means companies are operating with missing personnel. Discover how you can overcome labor shortages and grow your revenue with maintenance software management. Explore the current state of labor shortages in the United States, what they mean for your company, and what you can do to continue to offer quality equipment rental services.
Labor Shortages in 2022
Labor shortages are affecting nearly every industry. According to the U.S. Chamber of Commerce, there are currently country-wide labor shortages, particularly after more than 47 million workers quit their jobs in 2021.
Construction Industry
Some industries are affected by labor shortages more than others. The construction and manufacturing industries in particular are struggling to find skilled workers. An average of 4.4% of construction jobs were unfilled in 2021, according to Rental Equipment Register.
This could mean reduced equipment rental needs as companies struggle to find workers to operate heavy equipment rental products. Contracting equipment rentals account for approximately 56% of equipment rental industry revenue, so the construction and equipment rental industries are closely connected.
Another result of the shortage of construction workers is an increase in demand for skilled employees. Construction worker wages increased 5.1% from 2021 to 2022, according to Rental Equipment Register. This is believed to be caused by an increase in demand for not only workers but skilled workers in this field. There’s a growing percentage of employees in the industry who claim to be general construction workers, rather than highly skilled specialists.
Equipment Rental and Manufacturing Industries
Aging workers in the construction and manufacturing industries may make it difficult to find companies that need equipment rentals and locate the service technicians you need to maintain your fleet. Heavy vehicle and mobile equipment service technicians require long-term on-the-job training, according to the U.S. Bureau of Labor Statistics, so it can take time for new hires to learn the trade.
Related Challenges in the Equipment Rental Industry
Labor shortages are directly linked to other challenges for your company, whether you work in construction, heavy equipment rental, manufacturing, or a related industry. Missing workers translates into backlogged projects, decreased supply, and increased costs. Review these related challenges before finding out how a computerized maintenance management system (CMMS) can help you overcome these obstacles.
Declining Revenue
In the tool and equipment rental industry, revenue declined 1.7% in 2020, according to IBISWorld. This was caused, in part, by the COVID-19 pandemic, the decline in nonresidential construction projects, and supply chain issues.
Rising Equipment Prices
The cost of heavy equipment rental is rising in part due to the increase in equipment prices. Construction equipment increased in price by 9.7% in the last quarter of 2021, according to Equipment World. These increases are caused by the same supply chain issues affecting the automotive industry:
- Microchip shortage
- Labor shortage
- Backlog of cargo ships
Many construction equipment OEMs believe they could have sold up to 20% more if they had enough inventory to meet demand in recent years, according to Equipment World. If you operate a heavy equipment rental company, then it’s important to keep your existing equipment operational to avoid waiting in a backlog for a new or used equipment purchase.
As labor shortages threaten to increase your team’s workload, work order automation can help remove the task of work order prioritization for your service manager. If this task takes 25% of a day, then automating it could result in an extra 245 hours per year.
Service Solution
Many rental companies are concerned about acquiring new inventory and hiring the necessary technicians to maintain it. This is where maintenance software management can help. Equipment rental software, like Service Solution, helps streamline the equipment service schedule to optimize maintenance tasks.
This computerized maintenance management system allows you to identify which machines require maintenance, track equipment warranties, and maximize your limited labor pool to increase their wrenching time efficiency. See how Service Solution can help you with the following tasks:
- Keep valuable equipment operational
- Make the most of your service technicians
- Generate revenue
Keep Valuable Equipment Operational
It’s easy for rental companies in this climate to feel like they have too many service issues and not enough service technicians. A downed piece of equipment is a significant loss of revenue for a rental company. It’s estimated that for every $1 million in revenue, a single missed day of rental can cost about $2,739.
You need to know which equipment maintenance and repair tasks take priority to maximize revenue and reduce costly downtime. That’s where maintenance software management can help.
Make the Most of Your Service Technicians
If you have a shortage of technicians, it’s more important than ever to keep them working efficiently. This doesn’t mean pushing your workers to the point of burnout but using work order prioritization through maintenance software management to improve the efficiency of your staff.
As labor shortages threaten to increase your team’s workload, work order automation can help remove the task of work order prioritization for your service manager. If this task takes 25% of a day, then automating it could result in an extra 245 hours per year.
Generate Revenue
Equipment rental software can help you manage vendors. Labor shortages are part of the supply chain issue that may have strained your connection with key suppliers. Whether you operate a heavy equipment rental company or a construction team, a computerized maintenance management system can help you generate more revenue by increasing your inventory, helping you hire new staff, and optimizing your maintenance tasks.
Explore Innovation Solutions for Overcoming Labor Shortages
Don’t let a shortage of workers stall your business operations or limit your access to critical equipment. With Wynne Systems, you can enjoy Service Solution maintenance software management solutions. Contact us to learn more about Service Solution and how it fits into our suite of equipment rental and construction industry software solutions.
