December 12, 2017

Builders Recruit in Response to Labor Shortage

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Builders Recruit in Response to Labor Shortage

As more builders face labor shortages, they’re starting to look for new and faster ways to train more workers. 

For example, the Colorado Homebuilding Academy, a nonprofit organization, opened this year to offer a free eight-week “boot camp” to help increase the builder labor force. The course is founded and funded by Oakwood Homes, a homebuilder based in Denver that is owned by Berkshire Hathaway.

"Every single year, the labor situation has basically gotten worse," Patrick Hamill, CEO of Oakwood, told CNBC. "People retire, and there's nobody to replace them, and as an industry, ultimately we've just done a lousy job marketing our opportunities to young people.”

Oakwood started a foundation to fund the academy. It donates $1,000 for every house it closes. Oakwood projects it will close on 1,356 homes this year. The academy is planning to run 11 boot camps this year and train an estimated 200 workers. 

"Trade associations are involved, other homebuilders are involved, because we all know if we don't do this, we're not going to have a labor force to meet the needs of our industry," Hamill told CNBC.

The construction labor shortage is worsening nationwide and it’s causing the new-home sector to be unable to keep up with buyer demand. Homebuilders blame growing costs and a shortage of labor as the two biggest challenges confronting them this year, according to surveys conducted by the National Association of Home Builders. During the housing crash, many builders left the industry and have never returned. Also, an aging workforce approaching retirement age and a lack of young people drawn to the building industry are making the situation worse, builders say. Only 3 percent of young adults ages 18 to 25 recently surveyed by NAHB said they wanted to go into the construction trades when they start their career. 

"I wish we had them banging down the door; we don't," says Mike Smith, director of the Colorado Homebuilding Academy. "When we're working with the younger generation, it's tougher because there are not a lot of people looking at a job in the trades as their first career. … For the last several generations we've been saying things like 'work smarter, not harder,' but the negative consequence of that was [people deciding to] go to college and don't go to work with your hands. We’ve got to really change the mindset of the American public that these are great jobs that are really fulfilling.”

Source: “Desperate for Workers, a Colorado Homebuilder Starts a Free School,” CNBC (Oct. 31, 2017)