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WSJ: Labor Shortage in Construction

5/8/17       
Cabmaker

The Wall Street Journal today had a short article about how the shortage of labor is putting a crimp on construction projects.

Because of the shortage of labor construction costs are rising an average of 4% - 5% per year, outpacing inflation.

It used to be when contractors would bid out a project they usually had 2 or 3 subcontractors respond to each part of the project. Today they running into situations where there is only one subcontractor bid. This is driving the cost of some projects so high now they are no longer economically viable.

This labor shortage will make it much harder for Trump to effect the grand infrastructure projects he promised would happen.

The projects that do happen now will become much more expensive for the taxpayers to fund.

The infrastructure that does not get repaired will continue to crumble and become dangerous to live with. This is affecting the quality drinking water in places like Michigan, New Jersey & Oregon.

This problem, of course, pales with comparison to all the new cabinets that don't and won't get built.

Maybe we would be better off to focus on the bird's eye (To quote Alan F.) than what is easily digestible at a campaign rally.

5/8/17       #2: WSJ: Labor Shortage in Construction ...
David R Sochar Member

Great. Rather see the project costs skyrocket than re-teach ourselves how to (once again) pay people a living wage for meaningful work. I'll guarantee all the folks in the upper third of those poor suffering companies are not taking a pay cut.

As we rush headlong into transforming ourselves into a Nation of computer operators, skills of all sorts will diminish, if not disappear. We will have a hard time feeding ourselves, much less building water treatment plants. There will be boutique pigs and $20,000 chicken coops, but could the number of starving work up the class system?

Thankfully, we are a people that knows how to outsource. We can outsource all that nasty hard work ("Gee, this is hard!" as one notable said more than once recently) so it will not interrupt our lives of leisure and CEO-manship. As we all become Fortune 500 managers and Entrepreneurs just to pay off that student debt and still buy lettuce, we will enter the age where we are 99% college educated, but we cannot elect a leader that is more than a TV character, we are unable to fix anything, and all real work is priced out of reach, and who would want it anyway.

Rant 5.8.17 Complete
File under "Misunderstood"

5/8/17       #3: WSJ: Labor Shortage in Construction ...
cabmaker

David,

According to analysis by the trade group 'Associated Builders and Contractors', construction businesses, (excluding those building single family homes) employed close to 4.2 million workers in April of this year. The highest employment level ever recorded for this group was 4.4 million in February 2008.

The problem, however, is that we have 300 million US Citizens. It's the rest of us that have to pay these increased wages to re-build our infrastructure. This is great news for the 4 million construction workers but bad news for the rest of us.
We have to drive on those shitty bridges and drink that contaminated water.

It's hard to wrap a 3 word jingle around getting getting the lead out of our water systems.

5/8/17       #4: WSJ: Labor Shortage in Construction ...
Sam

>>>This labor shortage will make it much harder for Trump to effect the grand infrastructure projects he promised would happen.

>>>The projects that do happen now will become much more expensive for the taxpayers to fund.

Have to say ..... I find the current hype about devoting millions/billions/whatever to infrastructure interesting

It strikes me that the premise is, we create all these needed infrastructure projects, and all the out of work people in our society will now have jobs to apply for.

So I picture the guy hiring for a major project .... he's looking for people experienced in .... carpentry, concrete, demolition, heavy equipment... etc .... and sure, they need some laborers, but each year that goes by, everything either has a power cord or a steering wheel.

Truthfully ..... how long do you think someone who's never been around construction is gonna last after the first day where it's raining off and on, their command tool is a shovel, and they're legs are soaked and muddy from the knees down?

It's romantic and inspiring to look at the CCC and other depression era work projects photos and see thousands at work on the Hover damn and other big infrastructure projects, but give me a break - the idea that today's unemployed could slip seamlessly into modern day infrastructure projects is .... great PR ..... and that's about it.

And even if it gets to where the hiring ramps up, when the newly hired realize just how hard the work is, the light bulb goes off: can't afford health insurance, but hey, a injured back disability claim might be the real ticket outa here.

5/8/17       #5: WSJ: Labor Shortage in Construction ...
cabmaker

Sam,

You are right that skill is not necessarily elastic in supply. The skills necessary to build bridges are different than those needed for roofing , sheetrock or paint.

Right now the peso is trading very low relative to the dollar. This is, of course, exacerbating our trade balance with Mexico.

All the saber rattling has made holding pesos less desirable than dollars so the dollar can now buy a lot more Mexican product than it used to. We can, however, use this to our advantage.

A "good" negotiator would maybe cajole Congress into setting up some kind of path to use "documented" workers from Mexico. Documentation would help keep out the thugs while providing much needed labor for our farms and construction projects. This is a win-win for everybody because our construction projects and groceries will cost less and the strong dollar will help the Mexican's families back home.

We just need to find a good negotiator.

5/8/17       #6: WSJ: Labor Shortage in Construction ...
Pat Gilbert

I told yous this was coming...

The whole thing about infrastructure is mostly political rhetoric.

Bottom line this is just construction wages catching up with the other cohorts.

Apparently it pays to go to college. Albeit depends on what degree you get.


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