Beyond the Build

Construction Trends

Labor Pains Are Growing

In the cycles we live in, nothing is ever in balance. Five years ago, there was plenty of labor available, but a minimum of projects. Now we’re seeing an ever increasing list of opportunities out there.

I see the shortage of skilled labor increasing, along with skilled subcontractors, architects and building contractors.

A substantial amount of people and companies have left the industry since ’08. Because of the down cycle and our screwy immigration policies at that time, many international workers left the scene, and this has hurt as well.

Currently, service providers are scrambling around trying to be more efficient with their internal resources. It’s a narrow path. If one takes on too much work, a quality service experience is not delivered. Take too little and overhead requirements are not met. ROI goes down the tubes and, in the worst case, folks go out of business.

What do we do in the midst of the revival? Thoughts:

  1. Start with a quality team and a good set of plans, not a set of plans that just looks complete. There are fewer designers these days and sometimes they are pressured to get work out too fast. There is still some downward pressure on fees, which affects how many hours go into a job. Completion dates are rushed. Make sure the information input is as accurate as it can be, the first time.
  2. Ensure fees are fair. Provide proper time for development and vetting those plans, with some float time if possible.
  3. Don’t wear out the market, in particular with the subcontractor and vendor market. There aren’t as many as before. If plans have many addendums during the pricing cycle, the subs, vendors and contractors will walk to the next opportunity. Or they will price the project in the “throwing it against the wall” method.

Price is one thing, but meeting expectations without a lot change orders is another. Hate mail is not fun.

Merrill Stewart Jr.

Merrill Stewart is Founder and CEO of The Stewart/Perry Company, a commercial building contractor based in Birmingham.