Solve Two Problems at Once
Ask any contractor what his major problems are and two answers will be heard almost universally. One is the shortage of skilled labor. The other is intense price competition. The two problems are related.
All construction trades have suffered a severe talent shortage for at least the last 10 years. The simplest explanation has to do with unfavorable demographics and the proliferation of Americans who go to college, now upward of 50 percent of U.S. high school graduates. Prior to World War II, relatively few people had the opportunity to pursue higher education. Most couldn’t afford it and nobody in their families expected it of them.
Instead, many bright young people gravitated toward skilled trade work, which offered both prestige and high pay scales compared with most jobs in society. Both prestige and pay have taken a tumble in ensuing decades, at least in relation to other opportunities.
What denotes success?Not anymore. It seems that nowadays if one doesn’t wear a tie to work he isn’t regarded as successful. Young folks today are pressured by parents, peers and high school counselors to go to college even if they do not want to go or lack the aptitude. Some of them would make first-rate craft workers but instead pursue a career track that ends with them becoming third-rate paper pushers.
Alas, third-rate paper pushers often make more money than first-rate craft workers. The average nationwide wage in 2001 for a nonunion drywall finisher was $15.67, and for a plasterer, $16.32, according to PAS Inc., a company in Michigan that tracks construction wages. Multiply that by 2,000 hours of work a year, the traditional definition of full-time employment, and it comes out to between $30,000 and $33,000 a year. Benefits are nothing to write home about either with most companies. Moreover, it is dirty and dangerous work and often entails dreadful working conditions. The stark truth of the matter is that young people can make just as much money with fewer hassles tending bar, waiting tables or in some office.
Career advancement consists mainly of the opportunity to someday earn a few bucks an hour more as a foreman or crew chief. Or, going into business for oneself once a worker learns the ropes—or thinks he has it learned. This leads us to the second problem.
Bottom feedersHas there ever been such a proliferation of bottom-feeding competition? It stems from the fact that the vast majority of craft workers who go into business for themselves may be very good with tools and materials in their hands but most are clueless when it comes to understanding a balance sheet. Their marketing skills begin and end with bidding a low price to get some work. This makes it impossible for them to prosper or to pay above-market wages to attract the caliber of person who might find a career in your business rewarding and attractive.
Notice a certain irony in these two scenarios? On the one hand, suffering a shortage of skilled workers, on the other too many skilled workers masquerading as independent contractors and struggling to make ends meet. Wouldn’t it solve a bunch of problems to recruit some of the impoverished competitors to work? Some of the best workers around come from the ranks of people who couldn’t make a go of it working for themselves. They come back to the trade with appreciation for the problems faced by contractors and many would be delighted to be without the headaches.
Of course, this only applies if they end up working fewer hours with larger and steadier paychecks. It shouldn’t be too hard to justify above-average compensation for a skilled drywall finisher or plasterer with a degree in the hard knocks of business, especially when at the same time eliminating a bottom-feeding competitor.
If the state or local jurisdiction has licensing requirements for the drywall or plaster trades, call the licensing agency and ask to obtain a list of everybody licensed in the jurisdiction. Then send out a mailing to the people on the list inviting them to apply for a job. Be sure to list all the benefits the company has to offer and the appreciation of having people working there who used to be in business for themselves.
Some contractors who have tried this tactic find the licensing agencies reluctant to give out the list. They shouldn’t be. A list of licensees is supposed to be public knowledge and available for the asking, perhaps with a nominal fee to cover copying and mailing costs. But government bureaucrats sometimes get overly protective of their turf, or maybe just too lazy to fulfill a citizen’s unusual request. So be persistent. If a licensing agency worker refuses to cooperate, make a phone call or send a letter to the person’s supervisor, threatening legal action. It might not be a bad idea to also send a copy of the letter to the local media, letting them know that the mopes in the licensing office aren’t doing their jobs right.
If this tactic of recruiting competitors is tried, I think it’ll be surprising to witness the number of responses gotten—especially if some time has been taken to compose an attractive recruitment pitch. It’s not that there are not any good people out there. It’s just that many of them went into business for themselves not because of any entrepreneurial bug but because they felt that was the only way they could get ahead in the field. Make them feel welcome, treat them right and find two problems are being solved at once. W&C