Vince Bailey / February 2018
Where have all the young men gone, long time passing?—the late Pete Seeger, American folksinger
Happy days are here again—sort of. One of the most obvious indicators of the health of an economy is the unemployment rate (duh!). Joblessness in America peaked at a dreadful 10 percent during the marketplace horror of 2010 but has been declining over the past seven years. Current unemployment stands at about 4 percent, a sure sign of nationwide prosperity. But, ironically enough, even an economy in full flower can bring with it a certain cause for complaint—or, to borrow a well-used line from a popular Grateful Dead song, “every silver lining’s got a touch of gray.” Everywhere I go, I hear the same lament: There just aren’t enough craftsmen (skilled or otherwise) to meet the burgeoning opportunities that are opening up in the construction industry. We are experiencing a critical manpower shortage, and it’s putting a serious drag on an otherwise robust rebound in the building business.
Obviously, the dramatic increase in construction activity and the consequent demand for labor has caused the manpower shortage to be more keenly felt, but it is a shrinking workforce that is the real source of the problem. The dearth of field hands in this day of plenty can be attributed to a number of factors:
The recession turned workers off. The prolonged downturn in construction activity, especially between the years 2009 and 2013, forced many skilled construction workers to leave the industry in search of lower paying but more secure jobs. The recent uptick has not proven to be sufficient incentive to lure them back from more stable employment.
Lack of new blood. Young men and women graduating from high school are more attracted to attending college or otherwise pursuing careers in the information and/or tech industries. Fewer and fewer young people are inclined to work with their hands, as many tend to misguidedly attach some sort of inferiority stigma to workers in jobs that require physical labor. Higher wages and opportunities for advancement have not attracted nearly enough young people to our industry to replace the large numbers of retiring tradesmen. The negative impact of the lack of new blood on the building trades has gone from significant to critical.
Reduction in the immigrant work force. More stringent and more aggressively enforced laws against hiring undocumented workers have significantly diminished this sort of underground portion of the construction workforce. Programs such as E-Verify have virtually eliminated the presentation of bogus worker status documents as valid during the hiring process. Potential employers are discouraged from hiring questionable applicants presumably due to the harsh penalties associated with dubious hiring practices. Of course, fair prosecution of the law is necessary and appropriate, but more aggressive enforcement has had a profound effect on manpower availability, nevertheless.
Whatever the reasons, the manpower shortage is real, and it affects estimators and project managers quite critically. For instance, during most pre-construction negotiations, estimators are required to commit to a construction schedule, with most of them being quite aggressive. In view of the current workforce shortage, bidmeisters are compelled to either falsely overstate their firm’s ability to meet unreasonable durations, or honestly state their likely inability to do so. However, a third and more acceptable option would be to propose a premium time allowance to cover any potential Saturday work to make up for likely schedule lapses. Similarly, estimators must build projected wage increases into their pricing, and those rates must be competitive enough to recruit and maintain a company workforce to meet the procured work load.
Of course, there are other practices that commercial drywall firms can employ to adapt to a shrinking manpower pool. In addition to allowing for premium time and pricing for higher wages, a firm might be more selective in bidding projects, utilize second-tier subcontractors for part of the proposed scope, and explore the benefits of prefabrication to soften the blow.
During construction heydays, the temptation to pursue every opportunity looms large. Boom along with the boom seems to be the consensus notion. But procurement overreach in an era of manpower scarcity can lead to performance failures. Better to bid only projects that can be covered with the current manpower level. Projecting dramatic growth during current conditions can lead to dire consequences.
Many wise bidmeisters have cultivated mutually beneficial relationships with second-tier subs to assume some of the scope and thereby reduce the demand on their own in-house manpower. Insulation, acoustical ceilings, caulking and safing are all commercial drywall scopes that can be effectively and economically assumed by others.
Prefabrication of building components can dramatically alleviate the manpower crunch. Better productions with fewer hands can be achieved in a controlled shop environment with the manufacturing of full EIFS panels, light-gauge trusses, headers, stud-packs and even interior drywall panels. Doing more with less can be a key in adapting to the shrinking workforce.
Clearly, a diminishing manpower pool at a time of increasing activity presents a serious predicament to commercial drywall contractors. But clever firms will adopt strategies like those mentioned above to lessen the pain of the pinch.
Vince Bailey is an estimator/project manager working in the Phoenix area.