Walls & Ceilingsand USG recently hosted a contractor round table, giving nine residential drywall contractors a chance to share their experiences and concerns about the industry.

From insurance to changing workforces, from the price and quality of wallboard to expectations of GCs and owners, nine contractors recently swapped war stories that offer insight into the challenges facing residential drywall contractors east of the mighty Mississippi.

The participating contractors included: Don Martine, of Martine Drywall Inc., of Canton, Ohio, who services an average of 500 to 600 homes per year; Joe Thomas, of North Pittsburgh Drywall Co. Inc., of Renfrew, Pa.; Phil Geltzeiler, of Atlantic Coast Drywall Corp., of Little Silver, N.J.; Dwight Dodge, of Wal-Tec Corp., of Walled Lake, Mich., averages about 10 million square feet of drywall per year; JoLynn Swift, of Rinker’s Drywall Co., of Centreville, Va., averaging 600 to 750 homes per year; Bill Fineran, of Bridgeton Drywall Inc., of Upper Black Eddie, Pa.; Rick Voss, of Voss Textures, of Milwaukee, averaging 125 to 200 homes per year; Joe Carnevale, of Drywall Contractors Inc., of Indianapolis, with an $8.5 million per year volume; and Rick Schwartz, of Marietta Drywall, of Marietta, Ga., averaging 900 to 1,200 homes per year.

The purpose of the roundtable was for both Walls & Ceilings and USG to get some feedback from residential contractors on what issues are most important to them. W&C invites readers to consider themselves part of this roundtable and write the magazine to offer any and all comments and reactions to the meeting.

Affecting business

One of the topics first discussed was what trends were most affecting business. Swift answered that customer service was really affecting her business, especially in regards to expectations.

“I think the Internet is giving people information that they don’t really understand so they interpret it wrong,” Swift explained. “They read an article and they don’t think you know what you’re talking about and it’s hard to convince them not everything on the Internet is right.”

Customers are reading about mold and that is creating additional fears and demands from contractors. For Bill Fineran, whose company works on many projects for homeowners 55 and up, he’s discovering owners are having more access to projects still under construction.

“They’re not supposed to be there but they’re walking around the site all the time watching everything you do,” Fineran said.

Many of the contractors acknowledged that they are doing pre-drywall walk-throughs with homeowners. Consolidation of homebuilders in Indianapolis is changing the way Joe Carnevale’s company is dealing with subcontractors, in addition to the green construction movement. However, a big topic of discussion was the workforce itself: mostly made up of Mexican and South American workers. There is no lack of workers but the training is a real challenge.

“We look at mechanical contractors and they don’t use as many Hispanics because their work is more technical,” according to Rick Schwartz. “But when it comes to something like roofing, you give a guy a hammer and he’s a roofer.”

There were several observations about the Hispanic workforce made by the contractors. First, many don’t trust Americans. Because of the language barrier and social/economic differences between their culture and this one, there are reservations. Also, the legality of the worker can sometimes be an issue, with fake social security numbers, insurance coverage issues and the potential to leave, start a new company, and be able to hire and communicate with a Hispanic workforce always a possibility.

One solution suggested was to educate Hispanic workers, not just on proper drywall techniques, but on America and the English language.

Paperbead riders

Product advancement is another trend affecting business. Paperbead, spray-on finishes and more decorative options are all factors.

“Even the application process of putting stuff on with tape systems is better,” said Don Martine. “Where it used to be mostly hand finishing in our area, I’m finding more people are using what we call the boxes and angle tools, and so forth.”

Volatility of drywall pricing was mentioned, that one day it’s one price, and the next it’s “doubled.” The question raised was how does one pass these costs along? Also, more builders are buying the board and just paying for labor. This takes some of the control out of the hands of the drywall contractor.

“One builder has a purchasing agent who knows pricing to the penny,” says Joe Carnevale. “I hate fighting those kinds. If you want to fight over $100, I don’t want to fight. They’ve (builders) come to control the market.”

Dwight Dodge feels there is a benefit to the builder buying the board.

“The thing we’ve experienced in this market (Detroit area), is that if the drywall comes out spoiled, it’s not mine, it’s the builder’s,” he said. “I don’t have to stand behind it five years later after there may be a problem with it. You have to make sure they take that liability if you’re allowing them to buy the drywall.”

Poor engineering and framing were big sore spots with all the contractors.

“I was in a job one time when they had the TJIs stretched to the max and all the drywall seams were failing,” according to Martine. “I put a 3-inch-wide piece of drywall, cut tight from the floor to the ceiling, had the guy upstairs jump on the floor upstairs, the piece of drywall bowing in and out like a snake. All right, now, what’s my drywall going to do? The seams are going to move, so the engineering is slingshotting ahead of the drywall system, which can only tolerate so much movement. You’ve got all these techniques, you know, sneak around the back door, but they don’t always work and then you’re on the hook.”

“That’s like what we have on the bottom of our proposals and we send it out to all of our builders and it always confuses them, scares them to death, but it’s a little protection thing,” says Carnevale. “It says if you use any gloss or colored paint, I’m going to charge you 25 percent more. Well, they get that, they call me right away, ‘What does this mean you’re going to charge me 25 percent more? Does that mean you’re not going to do as good a job if we don’t use it?’ I said no. That means if you use gloss or color, we’ve got to do more things to protect ourselves. Drywall is such an imperfect product, but yet, they want to sell it as perfection. I had a lady in a $3 million house tell me she had flashing of joints and this big open room and lights, and she put semi-gloss—no one told us—on the wall. And I told her we should have known this up front. And she said, ‘I’m paying $2 million for this, I shouldn’t have to see that seam.’ I said, ‘Well, that’s true, but I did not frame this house either,’ and she just couldn’t understand.”

“And one other thing about the engineering,” Dodge added. “Literally, squirrels might be on those studs a month before you’re putting drywall on them, and the expectations are so convoluted. ‘Why is that twisting?’ You know, the engineering is just not there.”

If customers want perfect jobs from imperfect engineering, the drywall contractor is forced to charge more. The contractor does not create the wood.

“Yeah, a lot of it goes back to lumber, because it’s not dried out thoroughly, and you go in and your nails start to push out your screws,” added Martine.

“There are articles that tell them how to prepare a house before we get there,” said Schwartz, “and how often do you see that going on out there? That house is heated before you get there, the windows are actually in, the garage door is on and there’s just too much moisture in the house. That’s an issue because that’s what causes a lot of the ridges, a lot of the lumber’s starting to twist now because they turned on the heat or the air conditioning.”

Dodge added, “I have an example of a seminar I went to one time. The speaker said, ‘We do a lot of work for automotive engineers and, you know, they come out with micrometers and all these other instruments to inspect your work … but anyway, I want to say ‘Can you imagine, Mr. Engineer, if every day, first thing in the morning, somebody showed up in your driveway with a starter, and the next day they came with a couple of tires, and after three months they had built your car in your driveway? What kind of car would you think you have? That’s how we build houses. It’s not perfect.’

“One contractor mentioned that some framers, instead of shimming windows properly, are using roof shingles, all sorts of things and they’re not even all the way through the window,” said Dodge. “It’s like every 12 inches there’s a little shim.

“So we were trying to figure how to take care of this because you’re using a regular corner bead and your guy’s supposed to nail it every 6 inches, and the bead’s all twisted. Before you’re even out of there two months, it’s already cracked and you’re back fixing the windows. So, that was one reason when we noticed the paperface beads, we started using it for that. And getting back to the valued engineering, that’s what it’s all about, the builders figuring out how to squeeze more out of that house and make more and more money, and put more on the final subcontractors. It’s the rocker, the trimmer and the painter, we get pounded, because when the homeowner comes in, they start flipping on the lights, they’re there at night, all of a sudden there are all sorts of problems.”

“Yeah, and the builder does not want you to use the specialty boards that aren’t supposed to sag, or he doesn’t want you to use 5/8ths, and we try to throw it in there anyway so we don’t have a problem,” concurred Schwartz. “Sometimes, that knocks us out of the box in bidding on a job. And then with the builder, last five or six years, all of a sudden there’s a one-year warranty. I mean, it wasn’t even in our contract, all of a sudden we’re getting a phone call, ‘You’re doing it.’ And that’s an issue when you get back to how they build these homes and then how they educate the homeowner. And we try to send out like a friendly newsletter and try to say, you know, what we need to be prepared for with the house so we can give you a better quality job, but I’m sure those letters hit the oval file, but that’s what we’ve noticed that they never really took care of the house for us and there are always a lot of framing issues.”

The insurance concepts

Inevitably, the subject of rising insurance costs came up. While this is obviously an unpleasant subject for most, the roundtable actually agreed that there may be a benefit: consistency in quality. Rising insurance costs are going to force contractors to do quality work or else there will be no insurance at all.

“In the Atlanta market, it’s changing very drastically with insurance and what we’re getting in, I think, becomes a huge problem,” said Schwartz. “None of our subs ever had insurance, none of them. We always would take it out. We were required to cover so we would take 13, 15, 18 percent out of their check, whatever. If you took 13 and the guy down the street was taking 11, he’d complain and you’d have to take 11, whatever.

“But now what’s happened is our carriers have all come through and said, ‘We want all of your people to have their own insurance’,” said Schwartz. “We hardly have any Hispanics working for us who don’t have insurance. But they’ve got this really crazy insurance policy. They go out and they pay $600 or something—but they’re excluded as an owner. Now, we as owners are excluded, because we don’t work. We’re so busy trying to run jobs we don’t have time to put on the board, so I exclude myself because I don’t want to pay workman’s comp.

“If a worker is excluded, and he’s out there on the job working and he gets hurt, who’s he going to look to? Me. But the insurance people, that’s the only way they’ll do it with these guys. So, what’s he going to do? He’s going to drop his insurance, he’s going to run, he’s going to be gone.”

Have any of these contractors come up with strategies or tactics to help manage insurance? The reply was that one has to have a workman’s compensation policy and it has to be in place when going out to a contract. And secondly, every job they get paid for, they have to sign a contract. It’s just one paragraph stating the worker is responsible for his own taxes and insurance.

“Guys are painting 10 or 15 houses for me a week, they’re signing those contracts, they get a copy, I get a copy,” added Carnevale. “It’s not enough by itself to stand up if something happens to this guy who has no insurance and gives you a bogus certificate, but that, together with the bogus certificate, or a certificate that doesn’t cover the owner.”

Another contractor disagreed.

“No, it doesn’t work, I found out,” responded Geltzeiler. “We were doing that, it doesn’t work. If you don’t start registering them yourself, taking the time and registering them, forcing them to get a business checking account, all that you’re doing you’re going to find out when they come in because they’re going after our industry. You’re going to get slammed, because that doesn’t hold up in a court of law.”

“When things started heating up with us a couple years ago,” said Carnevale, “we went right to the attorneys and asked, ‘What are the laws that are governing the employees and what are the laws governing subcontractors? What are those laws from the IRS, and what are those laws from Naturalization and Immigration?’ New Jersey might add a few things to that, I have no idea, but I follow the law.” W&C