The home building industry has enjoyed an impressive run recently, and the picture continues to look rosy for at least the next 10 years. But there is a looming problem: labor, or the lack of it. Just how bad is the problem? “On a scale of one to 10, with 10 being the most important, I would rate the labor shortage as an eight or nine,” says Bobby Rayburn, NAHB president and a builder in Jackson, Miss.
Rayburn's sentiments have been echoed by many people—even those remotely linked to the home building industry, including university professors, job recruiters, and human resource managers. Any way you look at it, finding quality people to fill construction jobs is getting harder, and the problem is getting worse daily.
In Search Of One reason for the labor crisis is that construction is booming, and there is a shortage of people to fill vacant positions. Almost 80 million Americans were born during 1946 and 1964. However, only 28 million were born between 1964 and 1980. Those numbers have a lot to do with the current situation, says Bess Cadwell, vice president of the Scottsdale, Ariz., office of Management Recruiters International (MRI), the world's largest search and recruitment firm.
“What we are seeing is that the amount of people to fill slots is not like before,” says Cadwell, who specializes in the construction industry. “So everybody is scrambling to find good people, and the building industry is included.”
Aside from the smaller population, the talent pool is made shallower still because fewer young people are considering construction as a career choice. “It is hard to get kids into construction because it is seen as hard, dirty work,” says Laura Laseman, director of training for the Northeast Florida Builders Association's Apprenticeship Programs in Jacksonville, Fla. “The kids go into computers and other clean careers.” Moreover, Laseman says, construction gets little respect in the educational community. “It is difficult educating educators about the value of construction,” she continues. “Most schools don't even offer shop class anymore.”
John P. Kreiss, president of SullivanKreiss in Northboro, Mass., says the construction industry faces a tough challenge in terms of making the industry attractive to prospective candidates. “For one thing, it's a hard way to make a living,” says Kreiss, whose firm specializes in conducting high-level executive searches for the design and construction industries. “The industry still faces an image problem, too. By and large, most people in construction are good and honest, but you always see these horror stories of builders or remodelers who cheated their clients.”
Hidden In Plain Sight Faced with this tight labor market, builders are forced to use a variety of methods to attract and retain quality people—both in the field and in the office. Some are even thinking out of the box. More of MRI's builder clients, for example, are looking for candidates from other sectors such as the hospitality or customer service industries.
“A lot of builders are starting to realize that there isn't enough talent, so some are growing their own or stealing them from other industries,” Cadwell says. Home building is not just about building a structure anymore, she explains. “It's a service-oriented business, and the buying experience needs to be pleasant, so you need people who can relate to buyers.”
Builders also are exploring a previously untapped source for talent—minorities and women—though it's not for the reasons you might think. “It's not about race or quotas or anything,” Cadwell says. “In the past, people might have hired in their own image, but they realize now that they are missing the boat on a large pool of talented people.”
An employee referral program is another way employers attract talent, says Renee Labourdette, director of human resources for Emeryville, Calif.–based HomeGain.com, a company that provides real estate information and resources to home buyers. Not only is it an easy way to find new talent, but you get a built-in reference, Labourdette says.
To attack the problem at an earlier stage, the NAHB, U.S. Department of Labor, and other construction industry organizations have teamed up to launch “Skills to Build America's Future,” an initiative designed to attract young people to careers in the skilled trades.
Among other things, the program is designed to build awareness of the importance of skilled workers to the economy; inform people about the training, education, and apprenticeship opportunities available to those who are interested in construction; send the message that careers in these skilled trades are plentiful, lucrative, and fulfilling; and invite young people to pursue careers in the trades. Rayburn says this partnership is an important step in solving the labor problem.
The Northeast Florida Builders Association also is attempting to reach prospective candidates early with its four-year apprenticeships in areas such as carpentry, heating, and plumbing. “We are going to high school trade fairs and bringing in trades people to talk to students about how math fits into home building,” says Laseman.
Although there is more work to be done, Kreiss says the building industry has done a better job marketing its image to the public and has made strides in convincing teens and college students that construction is a viable career. “Builders have gotten the word out that a construction job can teach you to be a good business person,” he says. “They are getting the word out that it is a good place to be.”
Basic Training A small California building program reaps big rewards with high school students.
One reason there's a shrinking labor pool in the building industry is that fewer teenagers consider construction as a career choice. Home building is seen as an unattractive option compared to other professions, but high school building programs across the country are exposing kids to the trades and trying to reverse the trend.
One such program is Building Horizons, a Southern California program launched in 1994 by the Boys and Girls Club of Coachella Valley. Horizons, located in Palm Desert, Calif., started life as an experimental program to provide vocational training to high school kids. Today, it is a thriving building program in which 46 students build residential and commercial projects from the ground up.
“We needed to find a way to introduce kids to construction trades,” says executive director Dale Wissman. “By the time they get to college, they're not interested in it. We introduce them to a variety of trades and then we fund their education if they want to go to college.”
Under the program, kids attend regular classes in the morning and get hands-on building experience in the afternoon. The program receives building materials from manufacturers, cash donations from the community, no-interest loans, and other support from the industry, says Wissman. Cities donate all lands to the program or the program gets the property at a low price. Though qualified contractors and teachers are sometimes on the jobsite, the students do all the work. And once the homes are built, they are sold to low-income families. The program has graduated 300 students in the trades in the past 10 years and made a significant contribution to the industry, Wissman says.
“We are so successful [because] we reach out to the industry and bring them in,” Wissman says. “In turn, they can hire from the program. Schools like it because they get an affordable vocational program, and municipalities like it because they get affordable housing.”
New Recruits A university program is fertile ground for fresh talent.
Like any other industry, home building relies on a fresh crop of new talent to sustain itself. New candidates come from a variety of sources, but more and more prospects are coming from programs at colleges and universities. And one of the best is the Del E. Webb School of Construction at Arizona State University in Tempe, Ariz. One of only a few schools of construction in the country, Del E. Webb has over 2,500 alumni. It started in 1957 and became an endowed program in 1992. It will launch its first construction management Ph.D. program in 2005. “The construction manager as a role in the process is fairly new,” says Matthew P. Eicher, manager of industry relations. “Money is managed there, and it is a fairly important job.”
Del E. Webb's preferred job placement strategy is through its two mandatory internship programs—a field internship after the sophomore year and a management internship after the junior year,” Eicher says. Unlike some schools, Webb does not match students with companies, believing instead that students must learn the responsibility and develop their job searching skills. It also does not have career days. “Unless the companies are talking about internships, it does no good,” Eicher says.
All schools have different methods, but because Arizona has a healthy construction economy and numerous jobs to offer, this is the method that works best for them, Eicher says. And the results are evident. Three out of four graduates that intern with a company stay with the company. The school has a 100 percent job offer rate—even though not all students accept the positions—and one out of five graduates has gone on to own companies or become a CEO or COO. It is a success rate that any school would envy.
Learn more about markets featured in this article: Phoenix, AZ.