Minnesota’s Economic News — W/E 9/24/21
Labor market Pine Journal: Twin Ports area leads Minnesota with highest annual job growth rate Marshall Radio: MN Adds Jobs In August, Unemployment Drops Hometown Focus: Job growth continues in…
In a front-page story in the Star Tribune, “Help Wanted: Homebuilders Need Workers” (December 27), reporter Jim Buchta opened by noting how the “labor crunch is hitting home in the Twin Cities.” More specifically (and without the help of another worthy play on words as in his lede), he wrote:
“A persistent shortage of carpenters, plumbers, and other trades workers is jacking up the price of new homes and remodeling projects in the Twin Cities metro and causing frustrating delays at a time when demand for new housing is growing.” And that, “Nearly 90 percent of builders and remodelers surveyed by Housing First Minnesota say they have experienced a labor shortage in the past 12 months; 63 percent of them said the labor shortage has caused their firm to actually turn away business.”
A short while later Buchta quotes the executive director of Housing First Minnesota, David Siegel, who says meeting Gov. Mark Dayton’s goal of 300,000 new homes of all kinds in the next decade “will be exceptionally difficult if we don’t address this labor shortage.” This is abundantly true, as my American Experiment colleagues and I have been pointing out, and trying to fix, over the last two years in our “Great Jobs Without a Four-Year Degree” project.
As part of the project, I’ve written a book for which I interviewed Mr. Siegel and many others in 2017 and early 2018 about labor shortages in construction and other fields. Here are a few quick excerpts from Education Roads Less Traveled: Solving America’s Fixation on Four-Year Degrees, which will be released by Rowman & Littlefield in April 2019. Yes, this is a lengthy process. (And yes, this is a plug.)
Reinforcing what he told the Star Tribune, Siegel, the executive director of BATC-Housing First Minnesota [the group’s official name] said in an October 2017 roundtable I hosted, “We’re hearing across the association that a ten-percent increase in business would not be sustainable right now because of lack of staffing. When it comes to building and remodeling homes,” he said, “it’s taking four, five, or six months to do what you thought might take only two.”
Paralleling what Siegel had to say, Darlene Miller, owner of Permac Industries in Burnsville, responded this way when I asked how the shortage of sophisticated machinists and other well-trained men and women in the trades is hurting the economy. “Regardless of the industry,” she said, “we won’t continue to grow. We won’t be able to build enough cars, enough airplanes. But it’s not just manufacturing, it’s also not having anyone fix plumbing in our homes. It’s going to take six months to get someone to do a new roof.”
Hyperbole for effect? Yes. But then there was another business owner, Myron Moser, who spoke of a friend, the CFO of a large automotive group, who said she had openings for 77 mechanics, and that if she had them today, she’s hire them today.
Miller also talked about how much manufacturing had changed over the previous 25 years:
“When I got into the business, we were making simple components. Many employees got out of their pickup trucks, came in, and functioned. Now it’s totally the opposite,” to which I wondered how many young people simply would be scared away (as I would) by the intricacy of it all. To which Miller said, “You’re right. It could be intimidating, but kids tend to find it fascinating because they’re looking at screens all day as it is. These kids are talented when it comes to computers, so much more than people our age.”
Miller’s comment about talent flows back to topics we talked about in the October 2017 roundtable. Bob Michels, a builder, spoke of a job he was doing in rural Wisconsin.
“I got a guy coming out of Rice Lake. His name is Jeff. His email replies consist of ‘yes’ and ‘no.’ He’s got GPS equipment on huge machines. He’s building a 2,500-foot-long and 50-foot-wide road for me, according to specifications provided by an engineer. He’s got massive off-road trucks, massive backhoes, millions of dollars’ worth of equipment. I’m pretty sure Jeff didn’t go to college. He’s just a smart fellow who has taken advantage of his knowledge of equipment and probably his passion to operate machinery.”
What’s the connecting tissue in all this? Exactly what “What Great Jobs Without a Four-Year Degree” was conceived to stress and strive for:
Minnesota and the rest of the country do not have enough skilled workers in an expanse of fields, shortchanging the economy. This is a problem made worse by the retirement of 10,000, often highly skilled baby boomers every day. Leading to the crucial challenge of hiring millions of new, highly trained men and women to fill equal numbers of demanding and good-paying jobs. With “highly trained” and talent in this context understood, not as synonymous with four-year degrees, but with associate’s degrees, one-year and two-year certificates, apprenticeships, training in the military, and rigorous training on the job. Grit, too.