Construction Firms Finding More Jobs Than Workers
Written by Claudio Mendonca on July 14, 2005
By Claudio Mendonca
With high-rises blossoming across Miami-Dade County, the construction sector may bump into a shortage of workers even as the number of construction laborers rises.
"We haven’t reached a crisis yet but it is definitely putting a strain on the subcontracting community," said Jim Palermo, senior vice president of John Moriarty & Associates. "It has been very difficult. We have been having so much work but not enough skilled workers."
In Miami alone, more than 60,000 high-rise condo units are rising or in the planning stages, all due out of the ground in a relatively short span.
One solution, Mr. Palermo said, is to attract workers from other parts of the US. But, he said, many out-of-town laborers aren’t attracted by South Florida construction pay of $25 to $30 an hour.
"It’s hard for someone from out of state to come to Miami because many of them end up having to support two homes," he said. "The labor-shortage problem will be resolved when the market starts to slow down in the third quarter of next year."
The US Department of Labor says 42,500 persons are doing construction work in Miami-Dade County, 2.4% more than in May 2004. Five years ago, 39,100 were working in the building sector.
By comparison, hospitality employs 104,300 in the county and professional and business services 160,000.
"People are choosing other jobs where they can make the same kind of money and not have to work under the hot sun," said Phil Trucks, business manager of the South Florida Building Council and of the local plumbers union, who says construction wages, especially for the non-unionized, are among the lowest in the US.
"The wages aren’t there right now," he said.
Mr. Trucks said the average salary for non-union construction is $19 an hour as opposed to $24 for union workers, and most contractor work in South Florida is non-union.
But Coscan Construction President Michael Neal says South Florida is facing not a labor shortage but a glut of projects. In reality, he said, the problem contractors face is an increase in labor costs generated by contractors "stealing" employees from their competitors.
"What is happening now is that company A is picking employees from company B by paying higher salaries, therefore creating a dramatic rise in labor costs," he said.
"Labor cost is skyrocketing and we are seeing that all across the board. This is the type of problem that won’t be solved in the short term."
Contractors are in need of pipe fitters, electricians, mechanics and carpenters, said Al Petrangeli, division president for Florida Centex Construction. The lack of workers, he said, is affecting the industry, but Centex jobs won’t be delayed because it’s limiting the work it undertakes.
For developer Tony Rey, the short-term answer is to bring in laborers from other states.
"We are facing a big challenge right now," said the senior vice president of H & H Development. "Building supply is up and supply of workers has not been able to meet demand."