Feb. 26—TRAVERSE CITY — A handful are needed here, a dozen more over there.

Add it up and you get 546,000.

A proprietary model from the Associated Builders and Contractors recently estimated the construction industry needs to attract 546,000 additional workers "on top of the normal pace of hiring in 2023 to meet the demand for labor."

As staggering as those numbers are, those involved in the construction industry locally think the national report hit the nail right on the head.

"That sounds about right," said Dan Goodchild, the director of Northwestern Michigan College's Technical Academic Area. "Every single entity you can think of up here is short on people."

"The article is spot on," Hallmark Construction President and co-owner Jeff Fedorinchik added. " It's certainly nothing new to us. It (presents) a challenge we've been having. The community at large — or wider than our community — are starting to understand the labor shortage in our industry."

Nationally the construction industry averaged more than 390,000 job openings per month in 2022, according to the Associated Builders and Contractors report. The number of monthly job openings was the highest level on record.

"Isn't that staggering, despite the fact that overall work force participation is at its highest rate since 2000," Builders Exchange of Northwest Michigan Executive Director Lisa Leedy said.

"The construction industry must recruit hundreds of thousands of qualified, skilled construction professionals each year to build the places where we live, work, play, worship, learn and heal," ABC President and CEO Michael Bellaman said in the release. "As the demand for construction services remains high, filling these roles with skilled craft professionals is vital to America's economy and infrastructure rebuilding initiatives."

The problem in finding construction workers is made more difficult because every industry is doing the same. "It's a competitive labor market for everyone," Leedy said.

"Every conversation I have with a builder is that they're struggling to find subcontractors in HVAC, plumbing, electrical, painters and framers," Home Builders Association of Grand Traverse Area Executive Director Lauren Tucker said. "They are all dealing with those dwindling numbers."

The construction industry unemployment rate of 4.6% in 2022 was the second lowest on record and was just slightly higher than only the 4.5% unemployment rate in 2019, the ABC report said.

Lack of labor lingering

The issue of finding enough construction workers is certainly not new.

Fedorinchik recalls about 70,000 construction workers leaving Michigan in 2008 when the real estate industry bubble burst.

"Those workers never got replaced," Fedorinchik said. "Then we went through the pandemic and those workers never got replaced."

"It's been a problem for years," Tucker added. "Everyone is hurting right now across every business. They can't gobble (workers) up fast enough."

Founded in 1978, Hallmark Construction has a staff of about 38 people. Fedorinchik said he could make that number grow by more than 25 percent quickly.

"If we could find skilled labor, we could take on another 10 which would allow us to increase our capacity," he said. "Unfortunately we have to say 'No' too often, which is a shame. In 2008 we said 'Yes' to everyone because we were hanging on for dear life."

Novi-based Cunningham-Limp employs a staff of 42, which includes eight in Traverse City. Cunningham-Limp's work force includes engineers, project managers, superintendents and office staff and then hires subcontractors by the project.

And it is in the same boat as everyone else.

"We need a lot of people," said Jerry Tomczak, project manager for Cunningham-Limp at its Traverse City office. "A lot of (older) people are starting to retire and the younger ones aren't coming up in the trades."

Not having enough of a construction workforce leads to delays throughout the process.

"A crew of five builders can put up a house in about three months, as long as they have all their sub (contractors) ready to go," Goodchild said. "Most people now are waiting 13 months just to break ground."

"For homeowners, these are meaning longer build times," Tucker said. "Instead of a builder creating seven to eight homes a year, they're doing four homes max.

"They can't get the work if they can't get the work done."

Fedorinchik said the question of labor is the first asked by potential clients.

"It's a constant conversation we're having," he said. "I probably sound like a broken record. We're all competing for a similar workforce. It's a challenge finding younger people who want to enter our workforce."

Tucker said some in the construction industry have even decided to not participate in next month's HBAGTA Home Expo, some of which have been a part of nearly every one. She said there will still be plenty of exhibitors, but that decision speaks to the seriousness of the issue.

Tucker said some opting out of Expo participation told her it comes down to the issue of "I don't need more work that I can't do and that I won't get done."

Multi-level plan

The simplest solution to the complex problem is to pay workers more money to attract more into the field.

Leedy contends that has already happened. She said "Michigan has closed the gap" with a salary growth of 6% in 2022, the highest in 40 years. And still the issue remains.

"Just the wages alone aren't going to bring people into the industry," she said. "It will take multiple approaches to try and attract more people into the construction industry."

A lower birth rate, low unemployment and an aging population are all creating fewer people entering the trades. Leedy said simply attracting more youth is not enough, but a change in mindset is needed including ideas like flexible scheduling and removing "barriers for employment" like helping people to secure driving licenses and even expungement for past crimes to help pass background checks.

Technology and innovation may also hold the key for the construction industry to address a workforce shortage. Goodchild said technology like 3-D printing homes was a frequent topic of discussion at the recent International Builders Show in Las Vegas. Goodchild estimates there were more than 2,000 vendors and some 150,000 attendees at the event.

"There was a lot of new technology coming out of that to make up for the lack of a work force," Goodchild said.

"We are going to have to change our mindset as an industry to not only get the work done, but attract more people into our industry," Leedy said.

That doesn't mean the industry isn't reaching out to people at a younger age about skilled and construction trades.

A Build Your Life advertising blitz in the spring of 2022 helped boost participation in the carpentry program at NMC to 30 students. This spring Goodchild has 15 in carpentry.

Goodchild said there are more than 100 in welding, engineering technology, manufacturing, automotive and construction at NMC. Construction includes carpentry, HVAC, electrical, construction management and facility management.

"I think it's a two-prong approach," Goodchild said. "One, we have to have a younger introduction to all of these careers. Two, we need to present these as good careers to get into. Since way back in the day, if you can't go to college, then you can do (skilled trades). That is so far from the truth and a really poor way to frame these career fields."

"Our nation has told people for years and years that if you don't go to college and get a four-year degree after high school, you're nothing and your not going to amount to anything," Tucker said, noting the semi-skilled trades are also lacking. "We're working hard to eliminate that statement."

Tomczak — who is on a Build Your Life ad hoc committee and a board member at Builders Exchange and the HBAGTA Foundation — said NMC has a great program, an outstanding facility and has made a commitment to the skilled trades, including converting a part-time electrical instructor to full-time recently, partially funded by a donation from HighPoint Electric and Windemuller.

Leedy, who said there needs to be more integration between technology and construction in schools like NMC and Career-Tech Center, noted there also needs to be more upward mobility training sooner so the experienced workers can transition to management positions before they are unable to handle the physical demands on the job in the field.

"There's no one waiting behind that in the workforce who are going to take over," Tucker said.

"That experience isn't being transferred, which is leaving a huge gap in the middle of our workforce," Fedorinchik said. "There's no easy solution. It will be a decades-long or a generational solution.

"This is where this thing is. Is it 10, 15 or 20 years before we see any solution? That's the scary part."

Group effort

Most were in agreement that getting the word out about a lack of construction workers is a big part of the solution.

Tucker said scholarships at the state level have been beneficial so that organizations like HBAGTA and the Home Builders Exchange can then "build our infrastructure and programs to train people." She added these organizations have at times competed instead of collaborated over the years and has even seen some builders protective over traditional sub-contractors in what is "a community of sharing under normal circumstances."

"We have so many common goals and common members," Tucker said. "We're better and stronger together."

"We're all in this together," said Fedorinchik, who endowed the Barb and Dennis Fedorinchik/Hallmark Construction Scholarship in March 2019 as a retirement gift for his father.

Tucker said there is a need for 14,000 housing units in the 10-county area and about 1,100 in Grand Traverse County. Tucker and Tomczak noted the region continues to add people while the rest of the state is declining.

"We need people to build homes and meet the demand for housing," Tomczak said.

"The work is out there," Fedorinchik said. "It's not slowing down. And there's more of that to come. We just can't satisfy the demand currently."