The Bureau of Labor Statistics projects about 5% growth for construction managers through 2032. A general contractor is the professional who plans, coordinates, and delivers a construction project from start to finish. Learning how to become a general contractor means building trade knowledge, meeting licensing rules, and developing the business skills needed to manage budgets, schedules, and subcontractors.
Whether you’re a tradesperson moving into management or starting a construction career from scratch, this guide explains the typical licensing path, common requirements, and practical tips for long-term success.
What Does a General Contractor Do? Understanding the Role
Before focusing on how to become a general contractor, define the job. A general contractor is the primary party responsible for delivering the project scope, coordinating subcontractors, and ensuring the work meets contract requirements and building codes. The construction contractor is often the main point of contact for the owner, designers, inspectors, and trades.
Core Responsibilities of a Building Contractor
As a building contractor, you are typically responsible for:
- Construction project management: Managing scope, schedule, budget, and resources from start to closeout
- Subcontractor coordination: Hiring, scheduling, and overseeing trades such as electrical, plumbing, and carpentry
- Building permits: Pulling required permits and coordinating compliance with local regulations
- Material procurement: Ordering materials and verifying deliveries, quality, and lead times
- Client communication: Providing updates, handling change orders, and documenting decisions
- Building inspection: Scheduling inspections and correcting deficiencies to pass required checkpoints
- Construction safety: Implementing jobsite safety practices and enforcing site rules
The construction supervisor role blends field knowledge with leadership. You need to understand the building trade and run a job like a business: plan work, manage risk, and control costs.
Essential Qualifications: How to Become a General Contractor Step by Step
The steps to becoming a licensed general contractor vary by state, but most paths include education, documented experience, exams, and business setup requirements. Use this as a general roadmap, then confirm the exact rules where you plan to work.
Educational Requirements and Contractor Education Options
A college degree is not always required, but contractor education can shorten the learning curve and may be required in some states. Common pathways include:
- High school diploma or GED: The minimum requirement in many states
- Associate’s degree: Construction management or building science programs for core technical and business basics
- Bachelor’s degree: Degrees in construction management, civil engineering, or architecture for deeper project and systems knowledge
- Trade school programs: Focused contractor training in construction fundamentals and business operations
- Apprenticeship programs: Structured hands-on experience paired with classroom instruction
According to the National Center for Construction Education and Research (NCCER), contractors with formal education often earn 15–20% more than those without credentials.
Gaining Construction Experience in the Field
Most states require documented construction experience before you can apply for a contractor license, commonly two to four years. Build experience that shows increasing responsibility:
- Start in a specific trade: Build competence in carpentry, electrical, plumbing, concrete, or another specialty
- Work under licensed contractors: Learn estimating, scheduling, compliance, and jobsite workflows
- Take on increasing responsibility: Lead crews, coordinate subs, or manage parts of a project
- Document everything: Keep records of employers, projects, dates, roles, and hours
- Network actively: Build relationships with suppliers, subcontractors, and inspectors
Many general contractors work in multiple building trade roles before licensing. Broad exposure helps you identify problems early, coordinate trades, and manage sequencing on complex jobs.
Navigating Construction Licensing Requirements
Construction licensing varies by state and sometimes by city or county. Your first step is confirming whether the license is statewide, local, or trade-specific, and what scope of work the license allows.
State-by-State Contractor License Requirements
Requirements range from strict state licensing to local registration. A general overview looks like this:
- Strict licensing states: California, Florida, Arizona, and Nevada often require exams, experience verification, and financial documentation
- Moderate requirements: Texas, Georgia, and North Carolina have state-level requirements with varying thresholds
- Local jurisdiction states: Pennsylvania, New York, and Illinois often regulate contractors at the city or county level
Contractor qualifications often include:
- Minimum age requirement (commonly 18–21)
- Proof of experience (often 2–4 years)
- Passing a contractor exam
- Background check clearance
- Financial statement or proof of solvency (in some states)
- Contractor registration with the appropriate licensing board
The Contractor Exam: What to Expect and How to Prepare
The contractor exam typically tests code knowledge and business fundamentals. Many exams include topics such as:
- Building codes: Local, state, and national code requirements
- Construction permit processes and requirements
- Business and law fundamentals
- Project estimation and bidding
- Safety regulations (OSHA requirements)
- Contract management
First-time pass rates can be around 50–60% in some states. Practical preparation steps include:
- Use an exam prep course that matches your state’s test outline
- Learn how to navigate code books efficiently if the exam is open-book
- Take timed practice tests to build speed and accuracy
- Study with peers to compare notes and clarify weak areas
- Plan for 3–6 months of consistent study time
Contractor Certification and Professional Credentials
Licensing is the baseline. Contractor certification can strengthen credibility, improve project management skills, and support better outcomes on complex work.
Industry-Recognized Certifications
Common credentials contractors consider include:
- Certified Construction Manager (CCM): Offered by the Construction Management Association of America
- Project Management Professional (PMP): Demonstrates advanced construction project management skills
- LEED Certification: Shows familiarity with sustainable building practices and documentation
- OSHA Certifications: Demonstrates construction safety knowledge and compliance training
- NCCER Certifications: Industry-recognized credentials for many construction specialties
Some studies report that certified contractors win 20–30% more bids than non-certified competitors, although results vary by market, specialization, and reputation.
Insurance and Bonding: Protecting Your Construction Business
Most clients and licensing boards require insurance and bonding before you can work. These protections manage risk for property damage, injuries, and contract performance.
Understanding Contractor Insurance Requirements
Contractor insurance commonly includes:
- General liability insurance: Covers third-party bodily injury and property damage claims
- Workers’ compensation: Covers employee job injuries and is required in most states if you have employees
- Commercial auto insurance: Covers vehicles used for business purposes
- Tools and equipment coverage: Helps cover theft or damage to contractor tools and equipment
- Professional liability: Covers certain claims tied to professional services, design decisions, or advice when applicable
Contractor liability limits often start at $1 million per occurrence, and many commercial clients require $2 million or more. Premiums for a new contractor often range from $3,000 to $10,000 per year, depending on trade, payroll, claims history, and limits.
Bonding Requirements for General Contractors
Bonding requirements vary by state and project type. Common bond types include:
- Contractor bond (license bond): Often required to obtain or maintain a license
- Performance bond: Guarantees project completion according to contract terms
- Payment bond: Guarantees subcontractors and suppliers are paid
- Bid bond: Guarantees you will honor your bid if awarded the contract
A typical contractor bond may cost 1–3% of the bond amount per year. For a $25,000 license bond, that often means about $250–$750 annually, depending on credit, experience, and financial history.
Building Your Construction Business: Practical Tips for Success
Licensing gets you eligible to work; business systems keep you profitable. Strong estimating, documentation, scheduling, and cash flow management matter as much as field skills.
Essential Business Setup Steps
After you obtain your license, common setup steps include:
- Choose your business structure: LLC, corporation, or sole proprietorship each has tax and liability implications
- Secure financing: Establish credit lines and working capital for payroll, materials, and delays
- Invest in technology: Use estimating, project management, and accounting systems that fit your job size
- Develop processes: Standardize bids, contracts, change orders, and closeout documentation
- Build your team: Vet subcontractors and suppliers for reliability, safety practices, and insurance
Investing in the Right Contractor Tools and Technology
Modern contractor tools include software and systems that reduce errors and improve margin control. Many contractors invest in:
- Project management software: Buildertrend, CoConstruct, or Procore for construction project management
- Estimating software: Supports consistent bids and cost tracking
- Accounting software: QuickBooks or construction-specific accounting tools for job costing
- Mobile technology: Tablets and smartphones for field documentation and communication
- Drones and 3D scanning: Tools for site surveys, progress tracking, and inspections where appropriate
Marketing Your Services as a Building Professional
Marketing is often about being easy to verify and easy to refer. Practical approaches include:
- Build a simple website showing completed projects, scope, and service area
- Maintain active profiles on Houzz, Angie’s List, and HomeAdvisor where relevant
- Network with architects, real estate agents, and property managers
- Request reviews and testimonials from completed jobs
- Consider specializing in a niche (green building, historic restoration, commercial tenant improvements)
Staying Current with Building Codes and Industry Standards
Code changes, product updates, and safety requirements evolve. Contractors who stay current reduce rework, avoid delays, and pass inspections more consistently.
Continuing Education Requirements
Many states require continuing education to maintain a contractor license. Even when not required, continuing education helps you:
- Stay current with code changes and new building codes
- Learn new materials and construction methods
- Understand emerging technology and sustainable building practices
- Maintain competitiveness as standards shift
Many contractors complete 8–16 hours of continuing education annually, often covering construction safety, codes, and business management.
Understanding the Building Inspection Process
Understanding the building inspection process helps prevent failed inspections, rework, and schedule slippage. Common inspection checkpoints include:
- Foundation and footing inspection
- Framing inspection
- Electrical rough-in
- Plumbing rough-in
- HVAC installation
- Insulation inspection
- Final inspection
Clear documentation, clean work areas, and consistent communication improve building inspection outcomes and reduce delays.
Managing Risk and Workers’ Compensation in Your Construction Career
Construction has higher injury risk than many industries, so safety systems and workers’ compensation planning matter for both compliance and long-term cost control.
Workers’ Compensation Essentials
Workers’ compensation basics every construction business should understand include:
- Coverage requirements: Most states require workers’ comp for businesses with employees
- Classification codes: Construction work is often rated higher due to injury risk
- Experience modification rate: Your claims history and safety performance can affect premiums
- Claims management: Prompt reporting and return-to-work planning can reduce total claim cost
Over time, consistent safety practices can reduce workers’ compensation costs while protecting your team and keeping projects on schedule.
Creating a Culture of Construction Safety
Construction safety is most effective when it is routine, documented, and enforced. Common practices include:
- Conduct regular safety meetings and toolbox talks
- Provide appropriate personal protective equipment (PPE)
- Implement written safety plans for each project
- Train all workers on hazard recognition and prevention
- Conduct regular job site safety audits
Conclusion: Taking the First Steps in Your Construction Career
Learning how to become a general contractor typically involves building trade experience, meeting licensing requirements, and developing business systems for estimating, scheduling, documentation, and risk control. The work is demanding, but clear processes and strong fundamentals make it manageable and scalable.
Remember these key takeaways as you plan your path:
- Invest in education and contractor training to build a strong foundation
- Gain diverse construction experience before pursuing licensure
- Confirm your state’s construction licensing rules and scope limits
- Secure appropriate contractor insurance and bonding
- Commit to ongoing education and safety practices
- Build repeatable systems that support sustainable growth
The construction industry needs professionals who can manage both the jobsite and the business. With the right preparation, you can build a career as a general contractor and operate a durable, reputable construction company.
Ready to take the next step? Confirm your state’s licensing requirements, then estimate how payroll and job risk can affect workers’ compensation costs using this optional tool: workers compensation calculator. If you are planning to hire soon, you can also model workforce changes here: workers compensation calculator.
