Reshaping the Construction Industry

Amid high unemployment in areas like the Midwest where people have in almost no way been encouraged to retrain themselves and while there are calls for increases in the minimum wage for jobs in fast food, the construction industry is offering good paying jobs but hurting for workers in a big way.

There are a variety of reasons for this, naturally. The problem is especially bad in North Texas, reports the Dallas Morning News:

Dallas-Fort Worth leads the country in construction of both houses and apartments. The lack of skilled labor is adding months to construction timelines and helping to inflate property prices in Big D and beyond.    Read more » about Residential Construction Seeks a Million Workers

ConstructConnect, ABI, Beige Book signal positive, but mixed, outlook for starts

Editor’s note:  Construction Citizen is proud to partner with AGC America to bring you AGC Chief Economist Ken Simonson's Data DIGest. Check back each week to get Ken's expert analysis of what's happening in our industry.

The value of nonresidential construction starts decreased 5.6%, not seasonally adjusted, year-over-year (y/y) from December 2015 to December 2016 but increased 6.8% for the full year, data provider ConstructConnect reported on Tuesday. Nonresidential building starts (66% of the total) slipped 2.3% y/y but expanded by 11% for the full year. Commercial building starts dipped 1.7% y/y but added 11% for the year; institutional building starts, -3.9% y/y and +12% for the year; and the small industrial building starts segment, +0.3% y/y and -13% for the year. Heavy engineering (civil) starts (34% of the total) fell 12% y/y but only 0.5% for the year. The largest subsegments, in descending order of 2016 size, were school/college, down 9.7% for the year; road/highway, up 1.6%; water/sewage, up 6.8%; and retail/shopping, up 25%.

The Architecture Billings Index (ABI) score in December soared to 55.9, seasonally adjusted, the highest one-month reading since July 2007, and a large leap from November's mark of 50.6, the American Institute of Architects reported on Wednesday. The ABI measures the percentage of surveyed architecture firms that reported higher billings than a month earlier less the percentage reporting lower billings; any score over 50 indicates billings growth. Read more » about AGC's Data DIGest: January 16-19, 2016

A huge part of my job as the executive director of the Construction Career Collaborative is to spread the word about exactly what we are doing and what kind of progress we are making. 

That’s accomplished in a variety of ways including stories on Construction Citizen and speaking to groups of contractors, owners, and others. We also spread the word by doing news interviews with media outlets like the Texas Tribune and writing op-eds that appear in the Houston Chronicle

Over the last several months, we’ve added a new way for you to stay up to date with all the latest developments surrounding our movement: The C3 News Brief. 

The C3 News Brief is published once every two weeks and is delivered straight to your email inbox. In it, you'll find all the latest news about C3, information on upcoming events, recognition of C3 accredited employers, links to our training database, and updated facts about the Construction Career Collaborative.   Read more » about Stay Up to Date With the C3 News Brief

The following article originally appeared in the January newsletter to clients of Kiley Advisors, now a part of FMI Corporation.  Reprinted with permission.

We begin 2017 with optimism and excitement. We have been able to “walk our talk” about executing the right succession plan. As of January 1st, we become part of the Houston Team of the heralded consulting firm, FMI. The timing is right for us, I am now an octogenarian; Candace, a leading-edge millennial on the springboard of her productive years. They are attracted to my past and her future.

Candace and I are humbled and honored to join our industry’s leading consulting firm. Our mandate is to continue to serve our clients exactly as we have and to help them grow in Houston and Texas. This move gives us the capacity to add significant additional value with FMI’s vast resources of bright people, tailored industry data, and an impressive track record of helping construction companies prosper and grow.   Read more » about Practicing What We Preach: Successful Succession

A recent post by Joe Paduda, principal of Health Strategies Associates, in his blog, Managed Care Matters, titled “Construction Labor Fraud is Screwing Everyone” was the second in his series on labor fraud and the damage it is doing to the insurance industry. In this issue, he interviewed Matt Capece, representative of the General President at the United Brotherhood of Carpenters and Joiners of America, about how bad the worker’s comp problem has become in some key states like Florida, Georgia, Colorado, Oklahoma and Tennessee.

Capece said, “When we go onto jobsites in Florida, on 8-9 out of 10 sites we hear from carpenters that they are getting paid in cash.” He indicated that subs and labor brokers in Florida are paying in cash with no overtime or any other benefits like vacation, worker’s comp or training. Usually they are also misclassified as independent contractors as well.    Read more » about Games GCs and Subs (Labor Brokers and Insurance Agents) Play: Worker’s Comp

After an increase in construction related deaths, the New York City Council is poised to consider a raft of proposals aimed at increasing safety on jobsites throughout the largest city in America. Crane safety is on the minds of council members as is the oversight of smaller jobsites. 

If this package is passed, there would be stricter monitoring of “troubled actors” and increased penalties for lawbreakers.

More details from a site called Crain's New York Business:

The legislation, called the Construction Safety Act, is led by Council Speaker Melissa Mark-Viverito, but some elements could face resistance from Mayor Bill de Blasio, who has ambitious goals for housing development and has clashed with construction-worker unions. The mayor has already expressed skepticism with one of the council measures, a bill to require training programs for construction workers.   Read more » about New York City Council Moves to Crack Down on Construction Site Safety

Contractors are upbeat about 2017 markets; job growth slows as openings soar

Editor’s note:  Construction Citizen is proud to partner with AGC America to bring you AGC Chief Economist Ken Simonson's Data DIGest. Check back each week to get Ken's expert analysis of what's happening in our industry.

Contractors are optimistic, on balance, about the 2017 outlook for nonresidential and multifamily construction, based on the 1,281 responses to a survey that AGC released on Tuesday. About 46% expect the available dollar volume of projects they compete for in 2017 to be higher than in 2016, while 9% expect the volume to be lower, for a net positive reading of 36%. The net reading was positive for all 13 market segments included in the survey, the net was highest for hospital and retail, warehouse and lodging construction, at 23% each; followed by private office, 20%; manufacturing, 18%; highway and public building, 15% each; higher education, K-12 school and water/sewer, 14% each; multifamily and other transportation, 11% each; power, 10%; and federal construction, 7%.    Read more » about AGC's Data DIGest: January 6-13, 2017

If gas prices are higher the next time you fill up the tank, one of the reasons there will be less money in your wallet is a shortage of skilled craft professionals along the Gulf Coast.

Reuters reports that refineries in the region have been forced to postpone some scheduled maintenance due to a lack of skilled craftspeople needed to complete the jobs.

Industrial Information Resources (IIR) “estimates that the coastal region from Brownsville, Texas to New Orleans - the largest U.S. refining region - will be short roughly 37,400 craftsman needed to complete all of the planned capital projects in 2017.” Postponing the upkeep of these plants, in many cases, means slowing production or having to deal with unscheduled outages. Unexpected outages in the past few months have already taken “hundreds of thousands of barrels off the market,” causing a rise in gas prices.

Exacerbating the issue of too few skilled craftspeople in the Gulf Coast region is that “Refiners are also competing for workers with a broader range of power companies, pharmaceutical firms and industrial manufacturers nationwide, which are also preparing for a spike in maintenance projects in 2017, according to IIR.”   Read more » about Gas Prices on the Rise Due to Skilled Labor Shortage

On December 20, KBR and the Fort Polk Soldier for Life - Transition Assistance Program (SFL-TAP) celebrated the accomplishments of eight active duty Army soldiers who completed a rigorous, 120-day pipefitting training program. The program was delivered in an industry-education partnership with Central Louisiana Technical Community College (CLTCC) in Leesville, Louisiana. The graduates were awarded National Center for Construction Education and Research (NCCER) Pipefitting course completion certificates and credentials, and every graduating soldier will be offered top helper positions on KBR project sites.

On August 16, 2016 KBR launched the training program to train active duty soldiers under the Army’s Career Skills Program (CSP).  Soldiers who are within 180 days of separation have the opportunity to apply and be selected to participate in these competitive, Army-approved, civilian training courses in preparation for their separation from the United States Army. KBR partnered with CLTCC Lamar Salter Campus to host the training location and provide the soldiers with 28 college credit hours.   Read more » about KBR’s Fort Polk Pipefitting Program Graduates Eight Active Duty Soldiers

As the Texas Legislature convenes this week in Austin to make and revise the state’s laws over the course of the next five months, the associations representing the commercial construction industry are on the same page about quite a few issues they'd like to see lawmakers address. Unless otherwise ordered by the governor, Texas lawmakers only meet once every two years for 140 days in a regular session.  

Construction Citizen reviewed the legislative priorities published by the Texas Construction Association, the Associated General Contractors Texas Building Branch and the Associated Builders and Contractors of Texas. The groups are working together on a push to simplify the state's lien laws, but have different takes on things like reining in labor unions and they’ll each be on guard for any immigration-related initiatives. On that last point, the groups would like to ensure fairness for the construction industry if the Texas Legislature acts on mandatory E-Verify for example.    Read more » about Texas Commercial Construction Industry Sets Priorities for the Legislative Session

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