Houston, we have a problem. Dallas, too… and Atlanta, Charlotte, and pockets of Colorado, Arizona, Mississippi and South Carolina. That problem is construction labor, specifically the lack of skilled labor, and even more specifically, framing carpenters.
As housing seeks a sustainable recovery, builders in those markets and others are feeling the aftershocks of a post-recession skilled labor pool that moved on to other industries, back across the border, or into retirement without a new crop of home-grown talent to fill the void.
According to a MetroStudy survey reported by BUILDER magazine 18 months ago, the lack of labor is especially acute among large-volume builders; every builder with 250 or more closings in 2014 reported labor shortages.
Assuming the same holds true today, that’s 127 builders accounting for 248,197 new-home closings in 2015… roughly half of all closings last year, if you follow Commerce Department calculations. The industry’s modest growth this year is only deepening the impact.
The ramifications include stalled starts and delayed deliveries, rising costs, construction quality shortcuts, and dwindling profits and cash flow. It’s hard enough in this post-subprime, regulatory-rich climate to get loans, land, and approvals without a lack of labor twisting the knife.
But unlike bank policies and building department bureaucracy, the housing industry can do more than grouse and lobby for change when it comes to solving the labor issue – for the long term, not just now.
It requires direct involvement, a hands-on commitment from everyone. It’s our problem, and ours to solve as an industry. We can no longer rely on high school vocational programs to plant the seeds or government assistance to fund anything but college aspirations. Immigrant labor, by federal policy here and economic growth there, will not come back in droves. Aging journeymen deserve to retire. It’s on us.
Through the Housing Innovation Alliance, we are digging into the role that ideas like connectivity and new building practices can play in helping to address this issue. But in the meantime, there’s no short-term silver bullet. The best you can do right now is sharpen your site management, tighten your materials deliveries and construction drawings, and otherwise make it as easy as possible for framers to get in and out.
Longer term – and I’m talking the next 12 to 18 months – there are some ideas and tactics that we can take to grow and sustain the labor pool:
· Transfer knowledge & skills. Before that grizzled framer makes for Sun City, ask (and pay) him to mentor the next generation. Millennials are a largely untapped labor resource for construction mostly because they don’t see the allure. They respond better to mentorship than apprenticeship, to messages of craftsmanship versus production, and to the prospect of owning their own business.
· Retrain and recruit. While framers are in short supply, other construction skills are less so. Perhaps there’s a roofing, siding, drywall or insulation contractor (or one of his crew) you can retrain as a framer. Seek out women and minorities, who still make up only a fraction of workers. Demonstrate to the 1.5 million service men and women returning to the workforce that their military skills transfer to construction. If you want an extreme idea, look to neighboring counties or states where framing labor is less of an issue and recruit companies to relocate to your market.
· Invest in education, locally. Home Builders Institute, the ACE Mentor Program, and other national, state and local vocational programs need your time and money to recruit, train and turn out framers and other skilled construction workers. If your HBA is already involved, get in on it; if not, push that agenda, at the chapter level or on your own.
· Stop stick-framing (eventually). The fact that 90-plus percent of new homes are still stick-built is definitely part of the problem, but altering that method is not an effective bargaining chip with framers right now. While you consider a shift to whole-house panelization or a measure of modular to reduce time and manpower, look to your local lumber yard or truss supplier not just for roof, wall and floor components, but the labor to install them; 60% of the top 100 lumber dealers offer component manufacturing and installed sales, according to the latest ProSales 100 survey.
Our problem, our solution, that’s the bottom line. Even if these ideas don’t suit you, it’s on you – and all of us with a vested interest in this industry – to come up with practical and sustainable solutions if we expect to deliver on our customers’ expectations and forge a strong recovery.