Denver Developers Feeling The Pinch
Shortage Of Skilled Workers Stymies Projects
By Dave Felice
Around Park Hill and throughout the Denver area, the on-fire demand for residential and commercial construction and remodeling is apparently being tempered by a shortage of qualified workers.
On a recent job in Park Hill, one heating contractor noted, “I’d hire 20 people tomorrow if I could find them.”
“There are deficiencies in the current workforce,” says Phil Hayes, an agent for the Colorado Building Trades Council. “This shortage is consistent with several factors, including the age of the current workforce and people choosing other careers.”
Hayes told Greater Park Hill News that real and projected population growth also creates a need for qualified construction workers.
“It’s definitely a problem,” says Jason Hanson, owner of Bello Custom Homes. “We see a real shortage of younger workers because of a lack of emphasis on trade education. Many of our subcontractors have been with us because of relationships we established as long as ten years ago.”
Hanson’s company recently built two new homes at 23rd and Cherry in Park Hill.
Hayes is working with Colorado Associated General Contractors and other industry groups to help the state labor department administer a $10 million, three-year grant to fund training for carpenters, electricians, and plumbers.
Can’t build fast enough
The Colorado General Assembly set up the matching grant program to “facilitate recruitment for skilled worker training programs.” Figures from the legislature show that Colorado “is facing a serious shortage of skilled workers in various industries.” The shortage is likely to continue.
Metro-area contractor Clayton Carter reinforces the need for education and training.
“For either political or insurance risks, the high schools don’t teach trade skills anymore,” Carter says. “Many contractors will take kids right out of high school and put them to work immediately.”
Carter is co-owner of Claywood Construction. He says his training came through the family from his great grandfather.
The shortage of workers has a direct impact on the already tight housing market. Without skilled workers, construction companies of all sizes cannot build fast enough to meet demand. Because companies want to maximize their investment, many choose to build more expensive homes, creating an even greater shortage of old-style “starter” homes.
Fear of the unknown
The increased value of square footage also makes remodeling much more expensive. In some cases, there is more value in demolishing existing buildings and starting over.
The cost of building a single-family house is rising dramatically, according to industry reports. At the same time, mortgage rates continue to be at historic lows and the overall cost of a new home is up only slightly. Observers say the entire process dampens overall economic well-being.
“We’re working with both the city and the state to get people hired as quickly as possible, in both residential and commercial markets,” says Hayes. “There just isn’t enough awareness of the many apprenticeship opportunities, and this is not like traditional education.”
According to Hayes, workers who go into a trade apprenticeship program “have the ability to get an associate degree with virtually no debt.” He says workers earn while they learn, and start right away with a livable wage and benefits.
Hansen also sees continued growth in Park Hill, especially northward, stimulating demand for even more skilled workers. He says larger lots in the area can support the demand for reconstruction of larger single-family homes that are still sensitive to the neighborhood.
“Rebuilding is always a sensitive situation,” he observes. “In many instances, neighbors have a fear of the unknown. We try to match our buildings to the surrounding neighborhood and people generally like the result.”
Bonus for true craftsmanship
The legislation setting up the worker-training program noted that more than 130,000 Coloradans are unemployed, with about a third of those unemployed for more than 26 weeks.
Further observing that Colorado has a reputation for meeting needs by importing a large share of educated workers, “the state must insure that education and training are adequately preparing a work force aligned with needs.”
Hanson confirms the need to occasionally import workers. “A lot of the true craftsmen come (legally) from Latin America and Eastern Europe where workers have specific skills.” Hanson also says his company sometimes pays a bonus for special tasks.
“Mastering true craftsmanship is a real value,” says Hanson. “Even though working with your hands is sometimes seen as demeaning, someone with trade experience can always find a job.”
The workforce shortages extend to commercial construction as well. Hayes points out that “70 percent of vertical (multi-story) construction is plumbing, mechanical, and electrical, so there is more intensive training for the more robust work.”
1,300 new houses this year
According to a recent report by David Randall of Reuters news service, one Denver-area company is framing about 1,300 new houses this year, a significant increase over recent years. Randall quotes company owner Jay Small as saying he could construct at least 10 percent more houses if he could get the workers.
A large part of the problem, according to industry sources, is that more than one-quarter of construction workers went into other work when the housing market stagnated in 2007-08.
Randall reports some construction companies around the country pay immediate bonuses to attract workers. He says the highest demand is for electricians and carpenters.
A study by Colorado’s Associated General Contractors indicates the state will need as many as 30,000 construction workers over the next six years.
Dave Felice is an At-Large Board Member of Greater Park Hill Community Inc. He is a member of National Writers Union, Local 1981, and recipient of awards in 2015 and 2016 from the Society of Professional Journalists for news column writing. He can be contacted at gelato321@aol.com.