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Construction industry’s struggles magnified in local market

Construction
Travis Boland
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According to a recent survey conducted by the Associated General Contractors of America, 80% of construction firms are struggling to fill hourly craft positions that make up the bulk of the industry workforce.

Ken Simonson, AGC’s chief economist, said labor shortages in the industry remain widespread and significant despite the added number of jobs.

“We hope this survey can help rebuild our robust workforce pipeline,” Simonson said during a recent conference call. “Workforce shortages are affecting firms of all sizes.”

Tradesmen International, an online construction staffing firm, attributes the lack of workforce to people leaving the profession after the recession and not returning, the lack of teaching construction skills at the high school level and the influx of students to four-year colleges and white-collar jobs.

“The five toughest craft positions to fill, according to the survey, are pipe layers, carpenters, sheet metal workers, concrete workers and pipefitters/welders,” Simonson said. “These jobs are not going away any time soon, and it will only get harder to find that particular workforce.”

Columbia ranked last out of the 356 metropolitan cities surveyed after losing 10% of its construction jobs from July 2017 to July 2018. Columbia finished July 2017 with 21,200 construction jobs, losing 2,200 over the 12-month period.

“The Columbia metro area has had some of the largest numerical and percentage losses in construction employment ever since construction was shut down a year ago on the V.C. Summer nuclear power plant,” Simonson said. “But S.C. generally has had a strong nonresidential and residential construction market, and Columbia may be starting to get past the blow from the shutdown.”

Columbia saw an increase of 1,500 jobs in the July report from the S.C. Department of Employment and Workforce.

Mark Hood, president and CEO of Hood Construction in Columbia, said construction has not been an attractive career of late. He has seen the AGC survey findings borne out firsthand.

“Construction is starting to rally from the recession in 2008, ’09 and ’10,” Hood said. “Our problem is having (too few) new people coming into the industry, and the workers we have are starting to age out. One way we are trying to solve the crisis is by having more machines do the work. We have also looked at increasing wages to help bring people back to the industry.”

The AGC survey found 79% of firms that provide less than $50 million in total business, 83% of firms that provide between $50 million and $500 million in total business and 82% of firms that provide more than $500 million in total business are struggling to find skilled workers.

Simonson said many firms reported that the lack of workers affects both the cost of new construction and the duration of projects.

Sarah Hodges, senior director of the construction business line at construction, architecture, engineering and manufacturing software provider Autodesk, called the survey a call to action for an industry at a tipping point, with a need to expand its skill base.

“We want to be the technology and business side to the industry,” Hodges said. “It’s our job to get these new technological tools in the hands of those who want to be a part of the industry.”

In a news release, Hodges said technology can help provide new skills for future workers, with more firms utilizing in-house training and implementing digital strategies such as information modeling.

“Construction is not just that dirty, dangerous, dead-end career,” Simonson said. “It provides an opportunity to use new technology.”

Along with implementing more technology, the AGC has revamped its workforce development plan. Simonson said the group earned a win when Congress enacted the Federal and Career Education Bill in July to help build awareness of opportunities in construction. The bill renewed a federal workforce development program, sending $1.2 billion to states in a renewal of the Carl D. Perkins Career and Technical Education Act, the primary federal funding source for postsecondary career and technical education programs.

“There is more work to be done,” Simonson said. “The new plan identifies federal officials to support construction development, including doubling the amount of money invested in technical education at the federal level for the next five years. We are also working on long-overdue reforms of the immigration laws that will allow more people with construction skills to enter the country and steps to recruit more people into high-paying construction careers.”

This story originally appeared in the Sept. 10, 2018, print edition of the Columbia Regional Business Report.

Reach Travis Boland at colanews@scbiznews.com.

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