There is a great deal of discussion about creating more housing supply, but the question is, who is going to build it? The construction industry has a labour shortage and that’s a challenge for new development, including housing.
“We are limited by labour in our market for sure as far as how much can we grow and how much can we deliver in terms of inventory to our market – there is a ceiling to it,” says Tony Vigini, vice-president of development for construction company, Wales McLelland, which is nearly 50 years old and builds major industrial and commercial projects.
The company has a workforce of around 120 people at all times, and as with many construction companies in the Lower Mainland, is finding it increasingly difficult to attract workers in order to scale up and take on new projects. Mr. Vigini says it’s not a simple matter of signing a contract; they have to deliver. For that reason, he says the City of Vancouver’s housing target of 72,000 new homes in the next decade is not realistic, as the situation currently stands.
“It’s such a silly number, because they can’t even get approvals through the city to build 20 per cent of what they are forecasting, never mind finding the people to build and deliver it. And because everything else is still being built at the same time, it doesn’t mean the rest of the market is going to turn off.”
In order to retain workers, Mr. Vigini is one of many industry executives offering incentives, such as education and professional development, a competitive benefits program, and in an unofficial capacity, financial help with down payments on housing.
“We have got a workforce that’s been with us a long time, so that was never an issue for us until recently," he says. “In the last few years … you’ve got young men and women who are bright and talented and they say, ‘How can we afford a house?,’ ‘How can we get ahead?,' 'How can we start a family?’
"The real challenge for us is we have a pretty big workforce. So what you do for one you have got to do for all. ... We just don’t have the solution yet,” he says.
Another concern is that the industry will see its employees age out over the next 15 or 20 years. Construction workers account for almost 10 per cent of the province’s workforce, according to B.C. Construction Association (BCCA) president, Chris Atchison. Of that cohort, 45 per cent are older than 45.
The BCCA has made it a major objective to attract new workers, and as part of that mission, it’s working with members to offer employee incentives. Ironically, much of the housing that its workforce is constructing isn’t available to them, which is a problem. It recently announced a new mortgage-lending program that starts next spring. The program offers affordable payments and easier qualification than the traditional bank route. They want to broaden the program to include essential workers such as teachers and emergency personnel.
Another issue the industry association is working on is changing the workplace culture, trying to attract more diversity and put an end to toxic behaviours on construction sites. It’s working with construction companies – and there are more than 20,000 throughout B.C. – to institute new policies to create a safe and thriving workplace.
“We aren’t yesterday’s construction industry,” Mr. Atchison says. “There’s the way that we embrace technology, the way we are adapting to attract a different demographic of workforce, with more women, more youth, more indigenous representatives. The employers want to recruit anyone who wants to work in the industry.”
Many companies are already embracing the progressive policies, but Mr. Atchison wants to see a change industry wide.
“We want the entire industry to follow the lead of those exceptional employers and break down that perception that it is still a place you don’t want your children working.”
While young people commonly seek work in digital tech, they’re missing out on a growing construction field with jobs that are high in demand, high paying, and often high in technical skill, Mr. Vigini says. The most in-demand jobs are site superintendents, estimators and project managers, and those positions often come with six-figure salaries.
“I have young kids and I tell them, ‘Look at the numbers, if you look at the size of this market, at the size of the construction industry, if you want a career, if you are young and want a career, coming out of college, or trade school in the next three or four years and you start working in the industry, in 10 or 15 years, you will be at the top of that industry.'
“You can really take advantage of the opportunities there because there will be a much greater shortage of workers in the future than there is today. You will be commanding [a good wage] because frankly, I don’t see immigration stopping,” Mr. Vigini says. "People will always need places to live and work here. That’s why this industry will still be going and will still have a need.”
James Faulkner is founder and chief executive officer of SiteMax construction software company. He’s part of a new wave of construction jobs: he works in construction without having worked on a construction site. He’s also part of a podcast called Site Visit, which riffs on job site issues as part of a move to connect with the community.
“The important thing to note is that when anyone takes this industry seriously, they can slay it,” Mr. Faulkner says. “The young generation can kick ass if they take this seriously. It’s amazing how competitive [the search for talent] is.”
Mr. Faulkner’s former career was in branding. To build self-esteem among workers, he suggests that developers could create financing programs for workers to buy into the projects they help build. The companies could allocate a portion of their usual marketing budget. Such incentives would retain employees and create social capital within the community.
“It would obviously be self-serving for the developer from a public relations point of view, but holistically, it’s a big benefit. I’m just spitballing, but there are a lot of ways to bring these people into the fold of owning some of this privilege that they have built.”
And he thinks developers would likely be happy to do it.
Mr. Faulkner’s podcast co-hosts are younger and are both examples of construction industry workers who got into the housing market because of their high-paying jobs. They had to move outside Vancouver, but they found the bulk of their workforce is in the Fraser Valley, anyway.
SiteMax chief operating officer, Christian Hamm, who’s 34, worked on forming and framing crews to get through university, then he went into project management. He brings the “boots on the ground” to the company and the podcast.
Mr. Hamm purchased a house in Surrey’s Cloverdale area, six years ago, and started a family while living in the 700-square-foot basement suite. Today, they live in the main part of the house and the basement suite has become a revenue stream. It was a matter of timing, he says. He sympathizes with young people who are shut out of the market and desperate to get in.
“I felt the same sort of pressure and now you are pushed outside the city,” he says.
Not everyone his age cares about home ownership, he adds. There’s definitely a movement toward renting for a lifetime and avoiding mortgage debt.
“But, I definitely felt it was important, and not as a status thing. I just felt that especially in a city like Vancouver, that it was a pretty good anchor for a family and one’s own wealth building.”
Andrew Hansen, 28, worked for a construction company right after completing a business degree. Because he earned a high salary, he purchased a home in Langley and renovated the basement so that he and his wife could live in it, while renting out the upstairs. It was the only way to get into the housing market and the young family is still living in the suite.
He owns an industrial marketing company called SitePartners and several of his employees work remotely, which is a necessary option in this market.
He says keeping employees happy is the new way of doing business. He says one company has made the unusual move of offering a four-day work week.
“Really talented workers are in high demand and they go where they feel most rewarded and where they can be taken care of,” Mr. Hansen says. “I sit down with [my employees] and say, ‘How do we get you to become a homeowner?,’ ‘How do we work together on that?’ It’s a goal of mine to help them achieve that goal while working at my company.
“People want to grow businesses in Vancouver and in B.C., and their biggest restraints are, where is the talent is going to come from? Where are my employees going to live? How can they afford to live here? And you look at your balance sheet and your costs for what you can afford to pay people, versus what they need to live, and that’s a constant challenge.”
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