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Qualified Labour & Trades Shortages

Without a doubt, shortage of skilled labour and the underground economy are on top of the list of problems affecting the industry. In our latest Professional Readers Poll, readers report the extent of the effects and express some strong opinions.

Labour shortages seriously affected nearly half (48 per cent) of all respondents and 45 per cent said they are somewhat affected. Only seven per cent said it is not affecting them. Fifty-four per cent of builders said they are seriously affected and 34 per cent answered "somewhat." Only 12 per cent had no effects. For renovators, 42 per cent were affected, 56 per cent were somewhat affected and only two per cent not effected.
In the west (British Columbia and Alberta), 61 per cent said yes, 35 per cent said somewhat affected and four per cent indicated no effect.
Builders said that, as a result, sales, profits and call-backs were affected. A reduction in sales affected 52 per cent. Of these, 61 per cent said they had a sales reduction of up to 25 per cent, and 39 per cent reported higher sales loss estimates. Reduced profits affected 68 per cent of builders, of whom 79 per cent said profit reduction was up to 25 per cent. Call-backs on jobs affected 52 per cent, and 38 per cent said call-backs increased from 25 to 100 per cent.

The four major areas of labour shortages for builders were: framing (affecting 84 per cent), exterior finishing (84 per cent), interior finishing (86 per cent), and drywall (82 per cent). This was followed by roofing, foundations, electrical, plumbing and flooring. Others mentioned the following trade shortages: competent experienced carpenters, painters, insulators, HVAC, concrete flatwork finishing, timber frame joiners and project managers.
Builders said that this situation creates delays, extended construction time, increased overtime and the frustrations and headaches that go with it.
For renovators and contractors, sales, profits and call-backs are affected. A reduction in sales affected 70 per cent, of whom 71 per cent experienced sales reductions between 10 and 25 per cent. Over half (58 per cent) said profits were affected and 46 per cent said call-backs on jobs have increased by as much as 25 per cent.

The four major areas of labour shortages for renovators and contractors were: drywall (affecting 72 per cent), exteriors (70 per cent), framing (70 per cent) and interiors (68 per cent). To a lesser degree, labour shortages were also reported in: roofing, electrical, plumbing, foundations and flooring. Other areas affected include: masonry, HVAC, sheet metal workers, general labour and site foremen.
Renovators said that this situation forces them to pay more for less qualified labour, causes delays and increased backlog, and results in higher costs and more unsatisfied customers.

What can be done?
We were flooded with detailed, long and thoughtful replies. The majority favoured bringing in qualified immigrants and asked for less red tape and a faster approval process. More builders (42 per cent) than renovators (28 per cent) were in favour of accommodating other languages in codes and standards to ease the integration of immigrants to the trades. However, 72 per cent of renovators and 54 per cent of builders were opposed to this.
Builder Doug Henderson, of HWD Construction in Grande Prairie, Alberta, had this to say: "Simplify the process of bringing in labour from outside the country. Allow people to come to Canada with work permits not as immigrants, and expect that they will return to their home country once the work is complete." Russ Gibbs of Vic Van Isle Construction, a builder in British Columbia, said: "Until we can get skilled trades trained, we should be importing and pushing for licensing immigrants."

On the other hand, almost as many pointed to the serious need for better training and education of young people and creating a positive profile for working in the construction field. Easing the apprentice regulation was another topic that many suggested.
A builder from St. John's Newfoundland, Greg Hussey of Karwood Contracting Ltd. said: "We have already waited too long and no longer have enough senior experienced trade people to properly mentor new entrants into the residential industry. We have to go back to square one and develop industry specific training that relates to modern construction practices. We now have more specialized trades so the apprenticeship program that teaches all aspects of construction takes too long to get new people into the industry and forces everyone to get a quick overview of the industry rather than detailed training on the one part of the industry they are interested in."
Lou Frustaglio of Dreambuilders in Toronto suggested "encouraging and teaching the youth about the option of learning a trade. Tell them that working with your hands is a good thing and a worthwhile occupation. Do the same thing in foreign countries to encourage trades to come and work in Canada."
Greg Taylor of New Horizon Homes, a builder in Hamilton, Ontario, suggested telling youth who are planning their education that "skilled trades are equal to those of the technology careers."
Craig Hardy, of Covenant Construction, a renovator in London, Ontario, said: "Have the government change the apprenticeship ratios. This would allow companies like ourselves who believe in the program to sponsor more apprentices, and train them properly in the trade."
A builder in Halifax suggested that "tradesmen should be certified through the Home Builders' Association to avoid the black market, theft and delays on construction sites."
There were a few who suggested paying higher wages and others who said to do nothing and let market forces sort themselves. As a builder from Red Deer, Alberta, wrote: "Mess with the free market system and you will create a false economy with very little ability to react to 'real' conditions. We have seen this happen over the years, from winter works programs to subsidizing home construction in quiet times."

Source: Home BUILDER Magazine Readers Survey, August 2006

On August 24, 2006, we conducted an e-mail readers survey. As of August 31, we had received responses from 237 readers. Please note that this survey, by nature, reaches the more "sophisticated" in the industry and thus lacks input from the very small operators.
The responses came from: 99 builders, 51 renovators, 35 contractors, 10 suppliers, 31 manufacturers, and 11 "others". For the survey findings, we've used only the responses from builders as one group and renovators/contractors as another group.
Responses by province were as follow: British Columbia - 25%, Alberta - 21%, Saskatchewan - 3%, Manitoba - 4%, Ontario - 32%, Quebec - 4%, New Brunswick - 4%, Nova Scotia - 4%, Prince Edward Island - 1%, and Newfoundland - 3%.
Collectively, all the respondents employ 3,622 persons. Of the builders responding, 38 per cent have been in business for over 20 years and 46 per cent from six to 20 years. Among renovators/contractors, 54 per cent have been in business for over 20 years and 40 per cent for 10 to 20 years. From this, you can see that this survey's findings represent the established builders and reputable renovators - the people who pay the highest consequences for the problems we are trying to address.
Due to the length of the comments on this subject, the second part of the survey, which looks into the "black market", will be published in the next issue.

Home Builder Magazine will continue to conduct timely surveys about issues of concern. If you'd like to participate, please register (click here) to be counted and to let us know what you think.

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