There’s Plenty of Work for Construction Companies Right Now — and Not Enough Workers to do it

September 17th, 2019

At a new townhome development Jankow Cos. is building in Albany, one of the six single-family units had already been sold and sat essentially finished. It was scheduled for delivery in late July, but there was one key piece missing: the front steps.

David Phaff, who represents the project on behalf of Jankow Cos., said the developer was struggling to schedule a contractor to finish the work. The steps are just now going in, with a closing scheduled for mid-September.

“It’s a chronic problem. It is industry wide,” Phaff said.

Demand for builders is growing, and contractors have the appetite for the work — they just don’t have the workers. The shortage is driving up costs and making it harder to complete existing projects on time.

More than 80% of contractors in New York state say they are having a hard time filling positions, according to a national survey by the Associated General Contractors. About half of them say it will get even harder next year.

“At every level in the construction industry, there’s a workforce shortage,” said Mike Elmendorf, president and CEO of the Associated General Contractors of New York State.

The construction industry is increasingly feeling the effects of a decade-old economic downturn — the high unemployment and worker exodus of the 2008 crash are still holding back trades desperate to keep up with demand today.

Elmendorf said the 2008 financial crisis caused many contractors to retire early or get out of the business, and a decreasing interest in joining the trades makes it hard to fill the gap. As the economy has recovered and building demand grows, contractors are being stretched thin.

“There’s no question that the skilled industry has gotten very tight,” said Peter Belmonte, president of Belmonte Builders in Clifton Park.

Belmonte said some businesses never came back after the 2008 crash because regulations and insurance costs have made it more expensive to run a construction business.

Belmonte is building or planning a number of big projects: a 22-home neighborhood on Saratoga Lake, a 24-unit townhome project nearby, and a 320-home development in Wilton. To adapt to the worker shortage, Belmonte said he’s shifting around timelines based on contractor availability.

Attracting young people to learn construction trades remains a struggle, he says. They may be attracted to the idea of working with their hands, and making good money, but often dislike the idea of being outside all year. Working at a desk seems easier.

“Even parents are not encouraging them to be in the trades anymore. They’re encouraging them to be professionals,” Belmonte said.

More than half of the contractors surveyed by AGC in New York said they’re increasing pay to attract workers, and a third are offering bonuses or other incentives. They say pipe-layers and electricians are the hardest to find, but general laborers and roofers are also becoming more elusive.

“It’s not an easy problem to fix,” Elmendorf said.

https://www.bizjournals.com/albany/news/2019/09/09/construction-companies-worker-shortages-trades.html?fbclid=IwAR2LNiUmucXbRUOpkn5usKXfxbKBNdvGEYAM1ROA4_cM3lF-pokPZMH5M9Q