Despite the new I-74 bridge and other major projects bringing a higher demand for construction workers, industry leaders say the Quad-City region has the tools it needs to fill skilled trade jobs.
In August, national construction employment increased by 23,000 jobs, and by 297,000 jobs over the past year, according to the U.S. Bureau of Labor Statistics. An analysis by the Associated General Contractors of America, or AGC, stated that’s the highest employment in 10 years, since the 2008 housing crash, and a 4.3 percent increase over the past 12 months.
“The construction industry continues to add workers and increase pay at greater rates than the economy as a whole, with job gains spread across both residential and non-residential construction,” AGC chief economist Ken Simonson said. “But contractors report widespread difficulty in finding qualified workers for both salaried and hourly craft positions.”
While Illinois and Iowa haven’t seen the nation-leading growth southern and western states have, both have added more construction jobs this year. In July, Iowa added 3,500 jobs, a 4.7 percent increase over July 2017, while Illinois added 7,300 jobs, a 3.3 percent increase over last year, according to the Bureau of Labor Statistics.
The Quad-Cities has slowly been adding construction jobs, according to Jerry Lack, executive director of the Tri-City Building and Construction Trades Council. And employment has been boosted by the ongoing $1.2 billion I-74 bridge project, the $51 million reconstruction of John Deere Road in Moline, plus several new projects this year, such as hotels and corporate headquarters across the region.
The national hiring spree comes as the country’s unemployment rate is at a rare low of 3.9 percent. Iowa’s overall unemployment rate was down to 2.6 percent in July, and Illinois’ rate was at 4.2 percent.
Simonson said the increase in jobs, low unemployment and higher competition has industry leaders worried about filling positions, especially hourly craft positions.
“Be it construction or advanced manufacturing, we’re all competing for the same people,” said Chad Kleppe, president and CEO of the Master Builders of Iowa. “There’s so much competition in the workforce among all industries, and that’s the No. 1 challenge facing the construction industry. We’re competing for the same people Deere & Co. is competing for, and all other large and small firms. This is what 2.6 percent unemployment looks like.”
Last month, AGC put out a new study regarding the fear of a construction worker shortage. Out of the survey of 2,500 construction firms, three-quarters of respondents said their firms plan to increase staff of both salaried and hourly workers in the next year. But, 80 percent of the firms said they are having difficulty filling hourly craft positions.
A majority of firms said workers were harder to find than last year, despite many of them raising pay. Hourly earnings averaged $29.95 in August, an increase of 3.3 percent from last year.
In Iowa, 67 percent of firms expect to add hourly craft workers in the next month, while 91 percent of the respondents said it was already difficult to fill those positions. In Illinois, 68 percent of firms had difficulty filling hourly craft positions.
But the construction industry struggling to fill jobs is not new. After the 2008 recession, Kleppe said the construction industry faced a “mass exodus” of workers. Between 2007 and 2011, the construction industry shed more than 2.2 million jobs, according to the Bureau of Labor Statistics.
“People left the industry for other jobs and never came back to it. And now we’re facing the retirements and aging workforce in construction trades, as well as new hesitation to go into the trades,” he said. “Contractors are trying to figure out how to do more with less. They’re having to get creative.”
The workforce has been steadily rebuilding in the past several years, but shortages can still determine what projects are done across Iowa, according to Kleppe, who added “that’s not a great position to be in.”
Following the study, AGC released a Workforce Development Plan, calling on federal officials to double funding for career and technical education programs over the next five years, reform immigration and improve federal workforce training programs.
Major projects in the Quad-Cities have kept the construction workforce busy, especially with more than 250 workers, spanning five different trades, on site each day, building the new I-74 bridge, according to project manager Danielle Alvarez.
But local industry leaders agreed the Quad-Cities have been keeping up with construction job growth, and additional jobs have been filled this summer.
“We had a few school projects this summer that needed additional people, so we reached out to Peoria and Rockford and some construction trade members who could come here to work,” Lack said. “And they help the economy too, staying around and spending money locally. Overall, the Quad-Cities is doing better than a lot of areas, and has a more diverse economy. Our unemployment rate has been the lowest in Illinois.”
Lack said the Quad-Cities has worked on “cooperating regionally” in the past decade to fill additional jobs. Certain projects, like bridge work, have brought traveling union labor to the region.
But with an aging workforce and the cost of college rising, Lack said the Tri-City Building and Construction Trades Council also has been beefing up its apprenticeship program over the years. It offers apprenticeships for around 17 different crafts, including carpentry, iron workers and pipefitters.
“When the economy is good, that’s a good opportunity for us to increase apprenticeships and bring in more young people — and even middle-aged people for that matter — to learn the construction trades,” Lack said. “When the economy turned downward, we weren’t bringing in as many apprentices as we needed. But now we’re building a lot of projects and can hire more people. And we’re already seeing that. In plumbers and pipefitters, we had more than 200 applications to fill 30 slots. It’s a very competitive program to get into.”
Estes Construction President and CEO Kent Pilcher said his firm “strongly utilizes apprenticeship programs and works collaboratively with the unions,” to keep jobs filled.
“In eastern Iowa, there’s less of a shortage and issue, and part of that is because the Quad-Cities area is more of a union-based labor market than a commercial market,” Pilcher said. “The unions have done a good job filling the apprenticeship pipeline and meeting demand. If you get more over to central Iowa, that’s less so the case. There’s faster growth in Des Moines and central Iowa so there’s more shortages there.”
Industry leaders also highlighted the Quad-Cities’ advanced trade programs. Eastern Iowa Community Colleges’ Blong Technology Center partners with companies to understand their workforce training needs, for example.
Tondi argued the Quad-Cities is ahead of the curve when it comes to the construction worker pipeline. But with the cyclical nature of construction, an increase in job demand, plus a need to fill jobs left open by retirees, he said industry leaders continue to voice concerns.
“It’s hard to recruit younger generations into the construction industry because it’s hard work. It’s good pay but it’s hard work, and the conditions are tough,” Tondi said. “But we’ve been doing well for quite a while. That doesn’t mean everybody isn’t interested in increasing their numbers, because they are. Apprenticeship programs would like more apprentices. Contractors would like to have the labor available. Right now, we’re managing pretty well. But we’ve certainly struggled to replace the baby boomers.”
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