How Some Companies Close the Skills Gap

BobC

This type of program (see PDF from Foreign Policy) makes a lot of sense. Four years seems a little long, a bright person could get there in a year or two.

I know Germany has a very advanced apprenticeship program and after that workers can get more training to become a journeyman and eventually a master. The masters can make over 100k with no problem and no degree.

In the old days companies would hire a competent person and throw stuff at them, the bright ones would start to pick it up and someone in the company would help them over the rough spots. In many companies these days the turnover is so high that may not be feasible any more.

Bob

EBEBRATT-Ed

because of labor costs, most companies won't put an apprentice with a mechanic so he can learn. At least that's what they keep repeating.

so if you get somebody good that wants to learn how does he get on the job training......only so many air filters to change

bob_46

In my UA pipe fitter local the apprenticeship was five years and they had to switch employers every six months.

BobC

Here is more news about the labor problems in the trades.

All the trades are having trouble finding help, the labor market is tight in some areas but it seems young Americans are just not interested in that kind of work. If you look at the building crews over half of them are immigrants and a lot 0f them are getting very nervous.

Now with the administrations pogrom against immigrants some of them who have become citizens are beginning to rethink living in the USA. If young Americans don't want this work and capable immigrants get driven out, who's going to do the work?

Bob



Homebuilders struggle to fill jobs Americans don't want
CNBC
Diana Olick

At a sprawling construction site barely 15 minutes from downtown Denver, workers move ground, pour foundations and frame walls and windows, but the work goes slowly because of the slim workforce

Homes here take about two months longer than normal to build, and, in some cases, contractors are doubling their wages just to keep workers from skipping to the next site.

That's the backdrop as potential homebuyers in the mile-high city pile up and the supply of homes for sale continues to fall. Fierce competition pushes home prices higher at one of the fastest rates of any local market in the nation.

Housing industry veteran Gene Myers says he could be adding 50 percent more homes if he just had the people to build them. After weathering more than one recession, not to mention the worst housing crash in history, Myers says he has never seen anything like this.

"Especially the fact that it seems like we're at capacity at such a low level of actual absorption [sales]," said Myers, CEO of Thrive Home Builders, a midsized, privately owned builder in Denver. "In previous recessions, when we've recovered, we tend to see prices go up and labor starting to get tight after we've recovered to at least an average absorption."

He noted that Denver's average sales rate would normally be about 15,000 homes per year, and the market is now operating at just over half that rate. "We're feeling so much stress on the capacity of the industry."

Denver housing starts in 2016 were 22 percent higher than in 2015, but production is still historically low since the housing crash. Homes with base prices above $400,000 now represent 68 percent of the market, and homes priced above $500,000 represent 27 percent, according to Metrostudy, a housing analytics company. Both all-time highs are being fueled by steady demand from move-up buyers coupled with the rising costs of land, labor and materials.

Thousands of construction workers left the industry during the recession, many of them heading to the energy sector. The assumption was that they would return when energy lagged and homebuilding recovered. They did not. The labor shortage in building actually worsened in 2016 — a surprise to most analysts.

"We thought we'd see a flow back of workers from the energy sector," said Rob Dietz, chief economist with the National Association of Home Builders. "The labor shortage has basically grown and accelerated. It's the top challenge in the building industry right now."

Dietz points to both an immigration and a generational challenge. The workforce is aging, with the typical age of a construction worker now 42. More Americans are going to college now, and so they are less likely to pursue a career in construction. Simply put, young Americans don't want to build houses anymore. That leaves the business to immigrant laborers.

"These jobs, Americans don't want," Myers said. "We have a hard-working Hispanic labor force here in Denver that really is the foundation for the construction industry."

Immigrants make up about a quarter of the overall construction workforce, but that share is likely higher for residential homebuilding, partly due to a large number of undocumented workers. Builders say they make sure their contractors are legal to work, but they have less control over the subcontractors who often move from site to site. Even that group is shrinking, as President Donald Trump tries to impose travel bans and threatens to build a wall between the U.S. and Mexico.

"There is a fear to get out into the labor force, I think there is an uncertainty," Myers said. "I had one of our trades who became a citizen last year ask me if that could be taken away from him. Even for the people who are legal and documented, it's a factor that is holding back the labor force."

And it's costing builders more money. Wages in the residential building industry are growing at twice the rate of wages in the overall economy. Labor is the top concern among the nation's builders, according to an NAHB survey, and worry over its cost and availability is growing.

"Because the building industry is highly decentralized — there are 40,000 homebuilding companies in the country — you do see poaching. There are situations where you can recruit a worker, and they can work for you for a quarter or two, and then they're working for another subcontractor down the road," Dietz said.

Myers says he tries to build relationships with subcontractors. He has one-on-one meetings to build brand loyalty, but he admits, it often comes down to cold, hard cash. Some builders will spray paint a piece of plywood offering higher wages and drive it by a competitor's site.

"The crews, we would hope, would be loyal to subcontractors and to builders, but in reality, many of the crews are just going to the highest bidder," he said.

Myers has employed Juan, a Mexican immigrant, for more than a decade as an excavator. Juan, who didn't want to give his last name, said he became a citizen in 1999, and last year he and his brother-in-law started their own excavation company. Juan said some of his friends in Denver are buying property back in Mexico and planning to move back there. He worries about his own future and even deportation.

"I don't know what to think anymore with all these laws changing," he said.

Robert O'Brien

Yet there are no boilers going uninstalled? And certainly no shortage of installers wiling to do it for less! If there were a true shortage of labor, the price of labor would increase, and in fact it isn't

BobC

Several on this board have commented on the aging on the installer force and it being difficult to get young blood in the door.

I have not heard of any abnormal labor costs around here either but Boston is a long way from the southwest. The pressure is probably more palpable there.

Bob

Paul48

Someone needs to tell Juan, that the laws are not changing. They are being enforced. Forty years ago I worked in refineries in Texas. You would see a group of 40 Mexican workers running in every direction when the Immigration van pulled up. They were just trying to earn some money, but it wasn't legal then, either. Having worked on a framing crew, I know how long it takes to build a house. I feel terrible that folks are having to wait while their mansions are being built by under-paid illegal immigrants.....don't you?

Dennis

BobC said:

This type of program (see PDF from Foreign Policy) makes a lot of sense. Four years seems a little long, a bright person could get there in a year or two.

I know Germany has a very advanced apprenticeship program and after that workers can get more training to become a journeyman and eventually a master. The masters can make over 100k with no problem and no degree.

In the old days companies would hire a competent person and throw stuff at them, the bright ones would start to pick it up and someone in the company would help them over the rough spots. In many companies these days the turnover is so high that may not be feasible any more.

Bob

Germany up and until recently was predominantly occupied by Germans. They strove to live as a collective and a collective seeks the most efficient means concerning every aspect of life.

The USA is the opposite of a collective; As the present controllers of the world's only reserve currency other than gold (which we also control) the ability to squander large sums of money is the way of America and the reason for our tremendous individual wealth. In effect there is so much stinking money out there anyone who is currently poor is simply doing something wrong.

That said; America is an open market, the government exists to steal as much money out of this open market as possible while spending as much of this loot on themselves and their buds.

Government does not exist to promote business or education in any positive manner. Useful productive education is left to the business community, which understands educating its employees is overhead. As overhead education has to be rationed and only invested in the most efficient and productive workers. Sadly the work ethic in most people is long gone and is actually a rare commodity usually found in only the very small business person trying to create a better life. Most of these fail because larger businesses and government have created as many roadblocks as possible to promote failure.

There is no solution to this problem in the USA. In that the solution would be to act as a collective. Business would need to take over education, the population would educated in the 3 R's leaving off all the political correctness. From the early years the gifts inherent or lacking would be promoted. Children would be directed towards the fields most needing these gifts. There is no purpose trying to create an hvac mechanic out of one who desires to be an idiot. As was jokingly stated in the movie CaddyShack "The world needs ditch diggers too". The USA needs competent people in all fields, but the present State and Federal system of governance works in a way that has the least competent individuals in society presently ruling over us.

SlamDunk

you might find this interesting...When I heard it via word of mouth, I was surprised. Third paragraph.

http://www.ncbeec.org/wp-content/uploads/2013/05/NCEC_AUG-WEB.pdf