‘Obviously terrifying’ – what can be done to solve construction workforce woes across Northern Nevada?
By The Numbers
29: Estimated percent of current American construction workforce to retire by 2026
41: Estimated percent of current American construction workforce to retire by 2031
11: Number of years it takes to fully train someone to have the skills to replace a construction worker
$15.12: Median wage in Nevada of construction laborers
$28.42: Median wage in Nevada of first-line construction supervisors
$37.33: Median wage in Nevada of construction managers
Sources: National Center for Construction Education & Research; Nevada Pathways to Employment July 2019 report
RENO-SPARKS, Nev. — The Reno-Sparks region’s exploding economy and expanding skyline are creating demand for more construction workers — a lot more.
There’s a problem: The mounting pressure to meet project timelines comes at a time when the building-trades industry in Northern Nevada and beyond is suffering from a severe shortage of workers.
And the problem isn’t going away anytime soon. By 2026, an estimated 29 percent of the current construction workforce in the U.S. will retire. By 2031, that number will grow to 41 percent, according to the National Center for Construction Education & Research (NCCER) — meaning, nearly half of the industry’s workforce will be retired in just over a decade.
In all, there were 214,000 vacant construction jobs across the country as of November 2019, according to the U.S. Bureau of Labor. And as more and more experienced construction workers hang up their work boots, fewer and fewer millennials and Gen Zers have an interest in filling them.
It’s a reality that’s of considerable concern among leaders of the construction industry in Northern Nevada.
“It’s obviously terrifying because we already are seeing a shortage of labor in the workforce,” Brandon Hill, president of Carter Hill Homes, a Minden-based company that builds residential communities across the region, told the NNBW.
Hill estimated the average age of workers he sees on job sites is between 35 and 45. This tracks with the U.S. Bureau of Labor’s numbers, which show the median age of construction workers at 42.5 years old.
“Many millennials and, even more, Generation Z following them, aren’t necessarily focused or thinking about careers in construction,” he continued. “They’re tech-savvy youth and young adults who are accustomed to using computers and smart devices for almost everything.”
THE CATCH-22 OF RENO’S GROWTH
It’s been widely publicized that since the Great Recession, Northern Nevada has morphed into a hub for technology, with many big tech companies staking flags at the Tahoe Reno Industrial Center in Storey County and several more startups incubating at the University of Nevada, Reno Innevation Center.
Naturally, these fast-growing tech firms are focused on attracting and building a strong local workforce. This has inspired the education system to double down on programs steeped in tech — from cybersecurity to the Internet of Things (IoT) to advanced manufacturing.
While those growing sectors certainly need a workforce, one could argue the labor-crunched construction industry is being left in the dust.
“Where the high-demand jobs are and where we’re educating our kids are not lining up,” said Aaron West, CEO of Nevada Builders Alliance (NBA), pointing to a Nevada Pathways to Employment report published by research agency WestEd in July 2019. “It was staggering because we needed 500 engineers and we only graduated 250. But we graduated 700 kids with a degree in psychology and there were 30 jobs available (in the state).”
Don Tatro, CEO of Builders Association of Northern Nevada (BANN), said the education system is perhaps the No. 1 factor contributing to the labor shortage in construction.
“Our entire education system throughout the country has pushed four-year degrees and going into jobs that are not in the trades — anything but the trades,” Tatro told the NNBW. “Lack of funding and crowded spaces in schools has led to shop classes becoming computer labs. We don’t have an emphasis on these skills (for construction). So, if you’re never introduced to it, you don’t know if that might be something that you would enjoy as a career.”
And many of those younger people who do try their hand in the construction industry are struggling to stick with it, added Hill.
“One of our civil contractors recently told me that for every four new hires under the age of 30, only one has been working out,” Hill said “I see a high rate of turnover with the younger hires. They get into it and it’s harder than they thought, or a lot of them just lack the skills and resiliency needed to succeed in construction careers.”
In other words, not only are construction sites dotted across Northern Nevada lacking manpower, they’re lacking skilled manpower.
It’s a vicious cycle with no end in sight. According to the NCCER, it takes a full 11 years to train someone such that they will have the same level of skills as the people they need to replace. Consequently, the construction industry is seeing extra stress put on working crews and a wrench thrown in the timelines of projects.
“When you already have a shortage and then a high degree of turnover, you see schedules affected — delays and longer durations to get things done,” Hill said. “And then the quality suffers, requiring more supervision to get deficiencies corrected. We have projects across Northern Nevada right now — projects in Fernley and several down in Douglas County — and to some degree, they’ve all been affected by what I would call a lack of skilled labor.”
Melissa Maguire, president of Carson City-based Smith Electric Company, said the lack of skill and interest is impacting their operations, as well.
“We’ve had to make do with overtime and stretching ourselves a little bit too thin,” she said. “All of the journeymen have really had to step up. Everything has fallen to them.”
WHAT’S BEING DONE?
This begs the million-dollar question: What is being done — and what should be done — in Northern Nevada to help foster a new construction workforce?
Maguire said outreach is crucial; specifically, educating students and their parents at the middle school and high school levels of the “viable options outside of college.”
“There’s a misconception that construction is for outcasts or for dumb people or people who just don’t have a drive for anything else,” she said. “That’s not true at all.”
“I get frustrated when people tend to think of construction as low-skill, low-wage,” added West. “It’s not the case at all. We’re finding we actually have a ton of opportunity for high-skill, high-wage jobs in construction.”
According to the aforementioned Nevada Pathways to Employment report, the median wage of construction laborers is $15.12 an hour. However, the hourly earnings jump to $28.42 for first-line construction supervisors and swell to $37.33 for construction managers.
“If young people get into construction now, within the next five to 10 years, the opportunities for them to move up that corporate ladder are greater than they’ve ever been,” West said.
“The pathway to running your own business, to working your way up, is obvious,” Tatro added. “And it’s something that can be accomplished. Understanding the trade from the bottom up is a great way to get into the industry.”
This, Tatro said, is why BANN and other construction groups devote “a lot of resources” to Academy for Career Education (ACE) Charter High School, a tuition-free charter school in Reno. Created by Nevada Chapter AGC (Associated General Contractors), the school focuses on construction and vocational curriculum.
“It’s an amazing program that’s putting individuals square into the workforce,” said Tatro, noting the 200 some students help build a house every two years. “We don’t even do a job fair for students — we do a job signing. It’s a great opportunity for a lot of these kids.”
With that in mind, Hill said he’d like to more construction apprenticeship opportunities available at the post-secondary level in Nevada, adding: “That could be very powerful in helping our economy grow.”
FIXING ‘A BROKEN SYSTEM‘?
Hill and Tatro each pointed to another solution that could help with the labor crunch in Northern Nevada, and nationwide: immigration reform.
In 2016, immigrants accounted for one in four construction workers, according to a study by the National Association of Home Builders. Since President Donald Trump took office in 2017, it’s no secret that he’s ratcheted up border enforcement, reducing the flow of Mexican workers into the United States. Moreover, the Trump administration has tried to shift immigration policy to limit the entry of less-educated immigrants and draw more workers with advanced degrees.
“If we don’t have the supply here and there are plenty of people who want to step up, let’s make it an opportunity and fix a system that is absolutely broken,” Tatro said.
“We need to continue to encourage legal migration, especially of those with labor skills needed to grow the economy,” Hill said. “Making it easier for people who have passed background checks, and we know who they are, and they want to come here and work and be contributing, tax-paying members of our economy and not forced to live in the shadows.
“We are a country of immigrants who all came here in pursuit of the American dream, and we should always remember that.”
“Beginning in 2020, real estate enterprises must maintain contemporaneous documentation similar to the way a law firm might track time spent on client matters.”