Housing is experiencing a labor shortage like never before.
According to industry data provider, Metrostudy, the shortage is due to an aging/retiring skilled labor force in construction, a stronger than ever appeal of other industries for younger workers over construction, and new government policies that are weakening the availability of immigrant construction labor.
Mark LaLiberte, principal partner at Construction Instruction Inc., is hard at work on new programs to address the labor shortage, because, according to his numbers, the industry lost 600,000 framers in the downturn, plus the immigration issue is a big challenge.
These shortages force construction labor costs higher, and have caused builders to consider alternatives, mainly in terms of automation, says Mark Boud, chief economist at Metrostudy. Some developers and builders are taking matters into their own hands.
To address the issue, Katerra, a technology company redefining the construction industry, launched a new apprenticeship program, approved by the U.S. Department of Labor’s Bureau of Apprenticeship and Training, that offers portable credentials recognized in all U.S. states and three territories.
“It correlates with what the industry needs,” said Samantha Rist, head of self-perform at Katerra. “it also increased the odds of having a sustainable and robust program. The program should act as an attraction and retention program.”
The company currently recruits through a branch of hourly recruiters and advertises on online job boards with jobs for applicants that have experience in construction. The vision is that this approach will morph over time so that the company can start sourcing more from unskilled construction.
“If you look at turnover for the average 25-year-old in construction, it’s around 30%,” says Rist. “With this investment, we’d have the credentials that fit the purpose and match what we are manufacturing and then get higher retention.
“The great democratizer is training. It allows them to see that they have a potential long term path in Katerra. I know that because I talk to these folks when we walk the jobs. They are married, have children, want stability,” she continued.
And, hearing from the participants, it shows.
“After what I learned at the boot camp about Katerra's vision as a company, and what they plan on doing with the apprenticeship program, I don't think I'll be looking for another career for at least 20 years,” said Nathan Hunt, a framer from Boise, Id. “I've never been in a program like this before, nor have I heard of any other construction company that is willing to make this kind of investment in developing a high-quality skilled labor force and to develop leadership roles from within. Katerra has a unique vision for how both structures and skilled labor forces are built.”
Another bootcamp participant provided this comment on the program’s feedback form:
I’m excited to apply a lot of what I learned this week. I felt a level of mental growth I could have never imagined. I’m going to go in the field a more confident, safety-oriented employee.
Katerra is bringing its technology-focused approach to the training program as well. The program will have a mobile-enabled, cloud-based software to allow the workforce to log into a particular project, that will also track hours to scale effectively, providing accurate information for accounting and labor. The software will provide a reliable stream of information about labor for state requirements and optimize productivity, including crew sizes and mixes to operate in a safe and efficient way.
The Katerra Apprenticeship Program offers a combination of technical classroom instruction and hands-on training for a variety of trade occupations including carpentry, plumbing, electrical and HVAC with curriculums accredited through the National Center for Construction Education and Research. The programs have a wide variety of complexity to fit the long term skill, but each one requires approximately 144 hours of technical instruction per year and 2,000 hours of on-the-job training. Because of the vertical and horizontal integration at Katerra, the program had to support a total of 11 trades along with portable qualifications.
As part of the program, Katerra offers a series of week-long boot camps at its state-of-the-art factories for related technical instruction training modules. Plus, to ensure equal opportunity for training and development in the construction industry, Katerra partners with local high schools, workforce development programs, and the military in the areas where it operates to recruit for eager apprentices.
Will others in housing be able to adopt a similar program? What approaches will successfully address the pressing labor challenges?
LaLiberte says it will be very hard to do.
"Katerra's move is brilliant," he says. "That's the ideal way to go, factory trained workers and factory built homes. If builders don't control it in the factory, it will be much harder to get a similar level of quality in the field."
LaLiberte's Construction Instruction launched Ci Live a couple years ago and now offers two classes per month every month. He is working with many of the top high volume builders and recommends to them that their companies should invest in two days of training per year per person.
The hope is that these programs will help attract and retain the necessary skill needed for the continually increasing housing demand.
This story appears as it was originally published on our sister site, www.hiveforhousing.com.