Fresh out of college in 2009, Nick Conniff found that his prospects for landing a housing design job were grim. The recession had set in, homebuilding had screeched to a halt and the architecture firms where he’d hoped to find work were slashing jobs.
“I honestly can’t explain the frustration,” he said. “I felt like I’d went to college for no reason.”
He worked as a bartender and painted houses to make ends meet. And last summer, as he shopped for a house, he noticed sellers weren’t budging on price, and that properties were selling as fast as they were being listed — a clue builders might be back in business.
His instincts were right. At a recent construction jobs fair in Minneapolis, more than 100 companies were on the hunt for workers. Conniff applied for 17 internships.
The shift in the housing market is leading to hiring in all segments of the construction industry — from the trucking companies that haul materials to the welders who make scaffolding. Residential construction activity has been increasing at a double-digit pace, and with buying options limited, homeowners have once again started investing in new bathrooms, kitchens and other remodeling projects.
But with the upside of fresh hiring comes the downside of a worker shortage and overall skills gap.
Nearly 50,000 of the state’s 132,000 construction jobs evaporated during the housing crash, according to the Minnesota Department of Employment and Economic Development. Many of those workers, frustrated with the dwindling possibilities in homebuilding, left the industry for other careers and never looked back.
“We lost a generation of people who have stopped looking for work in residential construction,” said Marv McDaris, Minnesota division president for Pulte Homes.
The situation is being exacerbated by the increasing use of technology in the construction industry for everything from electronic job bids to sophisticated computer-assisted design software. In some regions of the country — especially those hardest hit by the housing downturn — it may take years to rebuild the labor force, creating a post-crash skills gap that has delayed projects and will lead to higher home prices as companies pay to recruit and train workers.
“People who bought [houses] last week will look very smart in 18 months,” said Hans Hagen, a veteran Twin Cities builder who says that the high cost of training workers will result in higher house prices. Indeed, the downturn forced many tech schools and colleges to cancel their construction training programs because enrollment plummeted, forcing builders to provide this training themselves.
“There wasn’t a lot of demand for jobs on the back end of those training programs, so they just faded away,” said Judy Swanson, program manager for HIRED, a Twin Cities worker training program. “And now we have more demand than we have students.”
Faced with training and higher prices on land and several key materials, several national builders, including Lennar and Toll Brothers, have announced plans to increase home prices. To help stave off costly training, McDaris said he recently helped organize a jobs fair that attracted more than 400 people, and he’s working with local nonprofits that train and recruit workers.
“We have to get people back interested in doing this kind of work,” he said. “We’re selling homes and now we have to make sure we’re getting them built.”
Already, the unemployment rate for residential contractors was at its lowest level in five years, falling from 22 percent in 2010, to 13 percent in April, according to the Associated General Contractors of America.
Todd Polifka, president of Brush Masters, a Twin Cities painting company, said that he’s constantly on the hunt for painters, so has developed an internal training program called Brush Masters University. “We’re willing to take less-skilled people and invest in them,” he said.
Lyman Lumber, which was in bankruptcy just a few years ago, has also started its own training program for a division that provides framers, window installers and other workers to the state’s biggest homebuilders, including Pulte and Lennar. John Zirbes, the company’s branch sales manager, said the company has already hired more than 170 workers and is on the hunt for at least 100 more, mostly carpenters with basic framing skills.
For the first time in Lyman’s history, the company has hired a full-time recruiter who attends at least one job fair a week.
While juggling handshakes and résumés at the jobs fair, Lyman’s recruiter, Kaylie Joseph, said homebuilders are having trouble meeting demand because they don’t have enough workers.
“They’re having to delay sales,” she said.
With office and commercial projects on the rise in the Twin Cities, including a new $900 million-plus Vikings stadium, commercial contractors are facing a similar squeeze. Twin Cities-based Kraus-Anderson recently received a $197,000 grant from the Department of Employment and Economic Development to train 400 workers in a joint program with Century College.
Perry Ruedy, an industrial arts instructor who lost his job at a tech school when it dropped its construction trade program, went on to design and implement a green construction training program at America’s Woodshop in Burnsville, which provides equipment and training to hobbyists and professionals. The first eight-week class graduated earlier this month, and demand for its graduates has been so strong, they’ve reduced the program to just four weeks.
Program graduate Gretchen Becker was hired immediately as a project manager for a local remodeling company, which is giving her another perspective on the challenges facing the industry. She’s managing several remodeling jobs and is having trouble getting subcontractors to bid on her work. She knows that scheduling them during the busiest construction season of the year will be a challenge.
Bridget Reynolds, Dunwoody College of Technology’s dean of construction sciences and building technology, said graduates of the school’s two-year construction trades program have already been snapped up, so the school is encouraging students like Randy Iverson to apply. He’s halfway through a two-year construction estimating and design program at Dunwoody, said it’s no longer enough to know how to pound a nail — companies want workers who already have on-the-job experience.
“They don’t want people just out of school,”said Iverson, who is new to the industry after a 10-year stint in the military.
Meanwhile, Conniff is confident that his search for a design job will be fruitful. Just a couple of weeks after the Dunwoody jobs fair, he’s already had two interviews. “I think I have a pretty good shot,” he said.