Phil Thomas with A.L. Huber Construction spoke to the difficulty of controlling the risk of subcontractors. “A lot of our subcontractors will have a tremendous amount of turnover,” said Thomas. “A company that you think you know very well might change dramatically over a year.”
The architects share the problem of the builders. “Retaining good talent, creative people, is clearly the biggest challenge in our industry,” agreed Bob Gould with Gould Evans. Jim Calcara of 360 Architecture affirmed that “finding good people, and keeping good people on your staff” is a critical task for his firm as well.
“There aren’t enough architects graduating from college and university today to replace the architects that will be leaving the profession in the near future,” affirmed Steve McDowell with BNIM.
“On the surety side, it’s a similar situation in terms of labor shortages,” observed Patrick Pribyl of Lockton. As Pribyl pointed out, the surety underwriting side has not done a good job of replenishing itself. Today, as a result, staffers average more than 50 years of age. “The only new entrants in our space since 2000 have virtually all gone out of the bond business already,” Pribyl added. One result is a “real capacity crunch” for the mega-projects.
“It is the aging of the labor force,” Rita Cortes of Hoffman Cortes said in the way of summation. “There are lots of efforts on the parts of the trades to recruit qualified folks who want to be in the trades long-term. That is a real challenge, to retain that younger generation.”
Atmosphere
Jim Kistler with Associated Builders and Contractors agreed with the comments about finding and retaining quality personnel, but he added a variable that others echoed, “maintaining a positive climate in which to operate without undue government interference.”
“In my duration in the construction industry,” said Tom Saul with Titan Construction, “the thing that I have seen change the most is attitude. I’d like to see us get back to the way the industry was 30 years ago, with the attitude of people in the field who care about what they do and how they do it.”
“I’ll echo what Tom said,” noted Doug Fogel. “Attitude everywhere.”
Surety Environment
Ernie Straub raised the question of whether the current capacity of the bonding industry is going to be able to sustain the boom in construction.
As Grover Simpson of the Lockton Companies had observed, one of the biggest challenges that they face in the insurance industry right now as projects grow in size is finding the capacity to serve such large construction projects and large contractors.
“If you look back 10 or 12 years ago,” said Simpson, “there were probably ten or twelve insurance companies that were active players in serving the large size construction projects. Today that number has shrunk to less than a handful of underwriters.” One of the challenges the industry faces is creating enough capacity and competition in the marketplace.
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