The lack of skilled construction workers and inspectors can put projects behind and raise costs.
By TOM ZUCCO, Times Staff Writer
Published December 18, 2005
[Times photo: James Borchuck]
A 29-story condo project at 400 Beach Drive in downtown St. Petersburg was scheduled to be finished in August 2007. But a shortage of skilled labor will delay the completion.
It sounded like something out of a low-budget horror movie.
"They stole him," Tom Slepetz said, the shock still evident in his voice.
The office manager at A. McBride Concrete and Masonry Inc. in Pinellas Park, Slepetz explained that his company had hired a superintendent for a large project last summer. But after just three months on the job, the super had vanished.
Who took him?
"The people we were doing the job for," Slepetz said. "There's a lot of that going on."
The construction industry in Tampa Bay, trying to move at warp speed to meet demand, is reeling from a lack of skilled labor, from electricians to plumbers to inspectors. The growing problem, contractors say, has led to project delays and cancellations, rising costs, accusations of construction sites stealing workers from others, and concerns of shoddy workmanship.
One of the key strategies to fight this: renewed efforts to find and train hundreds of skilled workers. And then hope they will stay in the trade, and stay here.
The Tampa Bay area would seem a construction worker's paradise. With at least six condominium projects under way in or near downtown Tampa, the annual value of residential and commercial construction permits in that city has passed the $1-billion mark for the first time and is nearly twice the value of permits granted in 2004.
St. Petersburg is also on a record pace with more than $400-million in new construction this year.
But the pace of that development, and the cost of the work, depends in large part on the size of the labor pool.
If enough workers can't be found, projects must wait. And the longer the projects wait, the more they'll cost, possibly putting the entire project in doubt.
"The drain on skilled labor here is a huge problem," said Craig Sher, president and chief executive officer of the Sembler Co., one of the developers of BayWalk. "Even my tree guy split for Louisiana after (Hurricane) Katrina and hasn't come back yet.
"Labor gravitates to where the action is. You can't blame them."
Sher and other contractors say the construction industry in the bay area is caught in a perfect storm, the likes of which few have seen before.
The ingredients are a white-hot building boom, unprecedented hurricane damage outside the area, and a pool of skilled workers that's getting older and not being replaced as rapidly as it once was.
The effects of the crunch go far beyond the inability to find a good plumber. Homes that took eight months to build can now take close to a year. And because the cost of materials is rising, those added months can mean several thousand dollars or more added to the cost of a home or condo.
And that, contractors say, can send some prospective buyers fleeing.
"We try to get subcontractors to cap the increases," Sher said. "But it's really treacherous out there. None of those guys (subcontractors) can hold prices for a long time.
"If you don't have a fixed price on a house, you don't know what it'll finally cost."
Another effect has to do with the people charged with making sure the buildings are safe. The pressure to hire skilled workers is almost as great as the pressure to inspect what's being built to make sure the project won't be held up.
There is at least the potential for problems.
"We dig a hole, put in wire mesh, get it inspected, then pour concrete," McBride Concrete's Slepetz said, describing a typical foundation. "We would never do this, but what's to stop someone from taking the wire mesh out, pouring the concrete, and then using that mesh for another project to save money?
"That could happen, because construction is running at 1,000 mph now."
Nowhere is that furious pace felt more keenly than at city hall. Alan Proper is the chief building inspector for the city of St. Petersburg. This is part of the recorded message on his office answering machine:
"In our recent quarterly meeting with the mayor, he told us the city has $1-billion of work either in progress or planned. So please be patient. We are very busy."
Proper's office has 19 inspectors to cover the city. Additional office staff has been added, but no new inspectors. Instead, inspectors from Orlando have been brought in to help ease the load.
"It's definitely harder for us because of the volume," Proper said. "We're doing two or three times the amount of business we used to, setting records on a daily basis."
The city of Tampa has about 50 inspectors, including nine who were added within the last two years because of the increased workload.
Neither the contractors, prospective buyers nor local governments want projects to slow or shut down while everyone waits for an inspector. The meter is running.
"The permits have tripled in five years, but the labor force has only grown by 25 percent, if that," said David Pelletz, president of the Tampa Bay division of Westfield Homes.
"Our costs have gone up so profits start to get eaten into."
In the meantime, inspectors are racing to keep up.
"I'm a little concerned about the future," Proper said, "because we know there's more out there, and we want to make sure inspections aren't rolling over too far.
"We also want to make sure everything is safe."
That's a concern shared by the contractors.
"If you don't watch out," said Carl Lindell Jr., president of Lindell Properties in Tampa, "you're going to have a lot of shoddy projects."
To weather the shortage storm, subcontractors like Slepetz try to keep a core of skilled workers they can regularly count on.
"Construction is tough in the sense you can hire a gang, but how many stick around?" he asked. "We've got a nucleus of 20 to 25 people. The rest are in and out.
"In the last six to nine months, we've been steadily running ads in the newspaper for help."
Slepetz said his company recently had to turn down a $2-million project because they didn't have enough skilled workers.
"If we take the job," Slepetz said, "it will absorb us. But what about our other customers? We can't do it."
In recent weeks, the focus has changed from where the current workers are going, to where new ones will come from.
Gov. Jeb Bush announced last week the state will spend $6-million toward training programs that can quickly get carpenters, roofers and other workers to job sites. A survey by the state found there were nearly 14,000 construction jobs that builders need to fill.
The average pay for those jobs was nearly $15 an hour, and some could pay as much as $30 an hour.
"We're not teaching these trades anymore," Sher said. "All the old-timers are retiring, and I'm not sure we're replacing them.
"Where are all the new electricians?"
At least some can be found in places like the Pinellas Technical Education Center in St. Petersburg. On a recent Monday night at least two dozen people, including several who had driven from as far away as Citrus and Hernando counties, were studying to become journeymen electricians.
The program is run by PTEC and the International Brotherhood of Electrical Workers Union Local 915.
"The shortage of skilled labor is real," said Jon Dehmel, an electrician with the union who has been through the program. But he said the average age of people entering the program now is over 30. It used to be 18 to 22.
"It's not supposed to be an easy course," Dehmel said. "And maybe that's why younger people don't seem too interested. Or maybe it's not seen as glamorous.
"But when you leave the program, you'll know what you're doing and you'll make $20 an hour."
Several other trade groups, including plumbers and nonunion electricians, also have apprenticeship programs in the area.
Still, there's nothing to prevent skilled workers from following the money. And if wages in New Orleans are twice those in the bay area, and if the competition here is fierce, the workers have the edge.
"We're incurring as much as a 30-day delay," said Bob Krieff, Tampa division president of Transeastern Homes, developers of Live Oak Preserve in Hillsborough County. "It used to take us 31/2 months to complete a home. Now it's closer to 41/2 months."
That extra time to build a house costs roughly $100 a day, mostly for debt service.
That may not seem like much unless, like Transeastern, you're building 1,000 homes.
"Worst case scenario," Krieff said, "that's an extra $3-million."
Coupled with higher costs for materials, it becomes impossible to keep the cost of a new home at a fixed price.
"So we're contacting our home buyers twice a month and explaining the progress or lack of progress," Krieff said. "It's important our buyers understand we have to be solvent.
"It is a perfect storm."
Or as developer Lindell, a former automobile dealer put it, "I thought the car business was competitive.