Shortage of skilled workers squeezing Twin Cities builders

09.08.17

Shortage of skilled workers squeezing Twin Cities builders

Nearly a decade after the U.S. economy collapsed and construction workers fled the industry, Twin Cities builders and contractors are in the midst of one of their busiest years. But a shortage of skilled workers means that new projects — from modest office renovations to soaring new apartment towers — are costing more and taking longer to complete. The situation has contributed to a housing shortage in the region.

Labor leaders say the industry has struggled to attract young people to replenish the pool of workers drained by the 2008-2009 recession, even though construction jobs pay above-average wages and most require just a high school diploma.

One reason for that, says Tim Worke, chief executive of the Associated General Contractors of Minnesota, is that vocational training has been devalued. “Everyone has been told that you have to have a four-year degree to be prosperous at life,” Worke said.

 But it’s a fine line, he added, because the old notion that construction is a field only for those with a “strong back and a strong body” isn’t the case anymore. The work is more technical and workers need advanced training, Worke said.
That labor shortage has serious consequences, as commercial construction costs are increasing two to five times the rate of inflation, local analysts say. Jim Durda, executive vice president of the local office of Zeller Realty Group, which manages the Fifth Street Towers and LaSalle Plaza in Minneapolis, said that 10 years ago it might have cost $25 per square foot to build out or remodel a commercial space. Today, it’s $35 to $50 per square foot, partly because of labor costs.
It also affects the residential market, as each new construction becomes more costly and time-consuming than ever before. Construction manager Troy Wenck of Reuter Walton Commercial said that he’s spending valuable time trying to recruit employees, and the company has had to turn away projects due to its shortage in workers. When the metro is already facing a housing shortage, it only makes matters worse.
Read the full story at StarTribune.com.