Senior Vice President & Chief Human Resources Officer, COMFORT SYSTEMS USA INC
The Skilled Trade Shortage, with Comfort Systems’ Terry Reed | People + Strategy
Season 1, Episode 13 In this episode, Terry Reed, senior vice president of talent and leadership development at Comfort Systems ...
About Terrence Reed
In a November 2024 podcast appearance, Terrence Reed, senior vice president of talent and leadership development at Comfort Systems, discussed the skilled trade shortage affecting the construction industry. Reed stated that the shortage of plumbers, electricians, and pipe fitters is forcing companies to be "very selective in the work we take" and is affecting the growth of both his business and the broader industry. He noted that more people are leaving the industry due to baby boomer retirements than entering it, and that the average mechanical aptitude of high school graduates is lower than in previous decades, requiring companies to invest in upskilling. Reed said the industry faces a perception problem, with many viewing construction as outdated despite technological advances. He argued that companies need to improve marketing to highlight opportunities and earning potential, and that in-house training programs are necessary to close the gap. To attract more women, who make up only two to five percent of the skilled trades workforce, Reed said companies should fund programs targeting middle school girls, educate guidance counselors, and create more inclusive workplace cultures and policies, including supportive maternity leave.
Transcript (37 segments)
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Host0:00
SHRM thanks Gap International for sponsoring this episode of People and Strategy. As a trusted partner to global leaders for nearly half a century, Gap International works with organizations to deliver superior performance. Gap drives transformational change by focusing on mindset shifts and performance breakthroughs. Learn more about our longstanding partner at gapinternational.com.
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Mo Fatalbab0:27
Welcome to today's episode of People in Strategy. I'm your host, Mo Fatalbab, president of International Facilitators Organization. People in Strategy is a podcast from the SHRM Executive Network. The premier network of executives in the field of human resources. Each week, we bring you in-depth conversations with the country's top HR executives and thought leaders. For today's conversation, we're recording live from the Visionary Summit in Austin, Texas. I'm excited to be joined by Terry Reed, senior vice president, talent and leadership development at Comfort Systems. Welcome, Terry.
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Terrence Reed1:02
Thank you, Mo. How are you today?
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Mo Fatalbab1:05
Good, good. Busy, but good.
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Terrence Reed1:07
Wonderful.
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Mo Fatalbab1:08
Terry, tell us about your career journey and how you got into the field of HR.
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Terrence Reed1:13
I grew up in the Southern United States in Alabama, and I got a degree in engineering, but I went into the army out of college. I was an army officer for about eight years, then I decided to use my engineering degree. So I got out and worked in manufacturing. I found myself consistently complaining about HR. As I continued to move up on the operations side, the CEO of the company said, 'You keep complaining about this, why don't you do it?' I was very lucky in my first HR job, and I transitioned into HR. This is the third company I've led HR for. I think I was an average engineer at best, but I think this is what I was meant to do.
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Mo Fatalbab2:17
I take it you've stopped complaining since you're still in HR.
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Terrence Reed2:21
Well, I still complain about myself, but no, it's a great profession. I can't imagine doing anything else.
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Mo Fatalbab2:32
Can you tell us about the skilled trade shortage?
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Terrence Reed2:35
Most of the HR leaders in my space talk about this quite a bit. There is a substantial shortage of skilled trades: plumbers, electricians, pipefitters, those types of things. It's having an impact on companies like ours in terms of being very selective in what work we take. We are consistently trying to figure out what we can do differently, but unfortunately there is no easy button and no one solution. It's going to take a number of things coming together with solutions.
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Mo Fatalbab3:29
Do you think the shortage is affecting the growth of your business?
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Terrence Reed3:32
Absolutely. It's affecting the growth of not only our business, but the broader construction industry. Our operating companies have jobs they could potentially bid on and get, but they have to balance that against the availability of talent.
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Mo Fatalbab3:57
I've heard some companies are actually creating trade schools and doing their own in-house training to upskill people in areas where they can't find labor.
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Terrence Reed4:11
Absolutely, and it's simple math. When you look at current job openings, projections, and the great work SHRM has done looking at data, plus trade school enrollments, you will not close the gap without creating some level of in-house training programs. The other factor is the average mechanical aptitude of kids coming out of high school versus 20, 30, 40 years ago. There's a gap. You're starting from a foundation where you may have to upskill in areas you might not have had to 20 years ago, so you need in-house training to close those gaps.
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Mo Fatalbab5:19
Other than the shortage, what's the biggest challenge in the trade industry right now?
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Terrence Reed5:24
There are a number of them. First, there is a perception issue that we're your grandparents' construction industry. We are a lot more advanced from a technology standpoint than people imagine. We have a diversity challenge as well. We have the most diverse workforce and talent base we've ever had, yet our industry as a whole is not there yet, and during that transition, there are individuals who may feel they're not wanted in this industry. Another challenge is the massive number of baby boomers retiring every day. We generally have more people leaving the industry than coming in. Finally, as an industry, we could do a much better job of marketing and selling ourselves in terms of opportunities and the amount of money people can make.
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Mo Fatalbab7:00
How can we attract more women?
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Terrence Reed7:07
Great question. If you look at the data, a little over 50 percent of the U.S. workforce is women. In skilled trades, it's two to five percent. We have a huge opportunity to attract more women. It starts with marketing. We have to ensure women know they're welcome and that we have opportunities. There are things we can do at every level, starting with organizations that work to get middle school girls interested in this industry. We need to fund those programs, and corporations like ours need to help. We have to educate high school guidance counselors and parents on the opportunity. We need good training programs, both external and internal. We have to make sure our organizational cultures and policies are more inclusive, creating an environment where women want to work for us. I tell our leaders to create a culture where you would want your daughter to come and work. If you are comfortable letting your 18, 19, or 20-year-old daughter work on one of your job sites, then you're probably doing the right thing. And we've got to be honest with ourselves when we are not there and close the gap.
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Mo Fatalbab9:07
And what does that culture look like?
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Terrence Reed9:09
Ultimately, it's a culture where it really doesn't matter if you're male or female. From a policy standpoint, is your maternity leave policy supportive? It's a bit more challenging in a field environment with time schedules and jobs. In most cases, we are part of a broader network of contractors on a job site, and we don't have the luxury of changing times because there's a sequence. So we have to get creative in meeting the needs of our employees without jeopardizing the schedule. You have to look at policies and the old locker room talk and boys' network. When you do those things, a lot of men feel better about working on that job site. You can't ignore it; you have to be transparent. As an organization, you have to be strategic about where you start. If you think about Jackie Robinson, there were teams where it was better he didn't start, and look where we are today. So you have to ask what the best place to start is and grow from there.
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Mo Fatalbab11:22
Give us a sense of Comfort Systems. How big is the organization, how many employees, what do you all do?
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Terrence Reed11:30
Comfort Systems is publicly traded, based in Houston, Texas. We have about 17,000 employees, and on any given day we may have another 2,000 to 4,000 temps and contractors. We have subsidiaries we call operating companies, about 46 operating companies in about 150 or 160 cities throughout the U.S. We are in the broader construction industry, more specifically considered MEP, Mechanical Electrical Plumbing. We typically subcontract work from major construction companies to help build buildings. We build data centers, and another huge part of our business is commercial HVAC. We don't do much residential HVAC, mainly commercial service to air conditioners on schools, hospitals, stadiums, things like that.
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Mo Fatalbab12:41
Ready for some rapid fire questions?
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Terrence Reed12:43
All right, here we go.
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Mo Fatalbab12:44
What's the one thing you do in the morning to start your day off right?
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Terrence Reed12:48
I pray.
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Mo Fatalbab12:51
If you could work anywhere in the world for a year, where would it be?
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Terrence Reed12:55
Singapore.
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Mo Fatalbab12:56
Why Singapore?
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Terrence Reed12:58
I had the pleasure of visiting Singapore a couple of times. First, it's the cleanest place I've ever seen. And people just seem happy. I got up one morning to go for a run and saw folks out cleaning the city, wiping down street poles. You don't see that anywhere else. A close second would be Italy.
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Mo Fatalbab13:37
If there's one skill that you look for when hiring, what would that be?
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Terrence Reed13:41
Probably lifelong learner. It's hard to assess in an interview, but especially with the rate of change in technologies, the life expectancy of skills is much shorter. You have to be a lifelong learner.
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Mo Fatalbab14:02
What's one piece of advice that you were given that has shaped your life personally or professionally?
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Terrence Reed14:11
The most important job you'll ever have is the one you're in now. I think sometimes, especially young people coming into the workforce, they consistently look too far ahead. If you do the absolute best job in the job you're in, people will notice, and it'll create an opportunity. Then you do the best at that job, and it'll create more opportunities. The reality is you don't know where those opportunities will go. Sitting in an engineering class in college a long time ago, I never would have imagined being in this role. So you do the absolute best job in the job you're in, and everything else will take care of itself.
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Mo Fatalbab15:13
Great advice. Thank you, Terry. And that's where we'll end it for this episode of People in Strategy. A huge thanks to Terry Reed, Senior Vice President Talent and Leadership Development at Comfort Systems. You can follow the People in Strategy podcast wherever you get your podcasts. Also, podcast reviews have a real impact on a podcast's visibility. So if you enjoyed today's episode, please give us a review to help others find the show. Finally, you can find all our episodes at shrm.org/podcasts. Thank you for listening and have a great day.
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Narrator15:53
SHRM thanks Gap International for sponsoring this episode of People Strategy. Learn more about our longstanding partner at gapinternational.com.