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0 of 3 Premium Clicks used this month SUBSCRIBE Print + Online Subscriber Activation | Register x Forgot Password | Need an Account? e-edition | subscribe | newsletter | deals Classifieds Jobs Autos Real Estate FEATURED » NEWS NOW Our View: Protect pristine headwaters from nickel mining ... Bumper crop ... Growers and Crafters Market searching for new homes ... Our View: Protect pristine headwaters from nickel mining ... Bumper crop ... Growers and Crafters Market searching for new homes ... BUSINESS Southern Oregon construction industry finds subcontractors in short supply Comment By Greg Stiles Mail Tribune MailTribune.com By Greg Stiles Mail Tribune Posted Jun. 28, 2015 at 12:01 AM By Greg Stiles Mail Tribune Posted Jun. 28, 2015 at 12:01 AM » Social News When Adroit Construction bids on projects these days, rising material prices often push its estimates higher. There is another factor, however, that has virtually every general contractor and residential builder in the Rogue Valley recalculating costs. More and more often, they discover there are not enough available subcontractors to handle specific parts of the job. "Residential development was booming 10 years ago and commercial construction was following suit," said Bob Mayers, president of Ashland-based Adroit. "Subcontractors and general contractors were quite healthy financially." The recession that followed, however, tore through the ranks, ruined small companies and forced tradesmen to the sidelines — some permanently. "Commercial construction dropped off the charts," he said. "The recession eliminated many firms that couldn't sustain through a long recession. Those that survived ratcheted back." Commercial and residential construction have rebounded modestly from the depths of the Great Recession, but the ranks of the subcontractors have not. Uniformly, contractors will tell you they are not only harder to schedule, but may command a premium to bring in crews from outside the area. Relocations, career changes and retirements have taken their toll. "Everyone is vying for same personnel out there," Mayers said. "The recession minimized the construction work force. A lot of the people got out of the trades, many left the area and they are not to be had. Many of them are limited because they don't have the staff to take on the workload." As a result, subcontractors often find themselves pushing jobs into the future. "We're as busy as we want to be," said Covenant Concrete owner Steve Trautman. "Right now, we're booked out four months. Usually, this time of year we're maybe a month out with a lot of potential work." There's a domino effect, Mayers said, creating other issues often relating to experience. "When the downturn hit, it was a big hit on a lot of people," said Andy Batzer, vice president of Batzer Construction in Medford. "During that time you had a lot of good craftsmen looking for work, and now all those good craftsmen should be able to find all the employment they want." The problem for local builders is larger metropolitan areas began making the comeback two to three years before less-urban regions. "Those craftsmen moved," Batzer said. "They just aren't here anymore. I don't think it's too bad in Medford now, but if the economy improves we're going to see it. Then the subcontractors will either be unavailable or incompetent." Home builder Karic Roberge, owner of Whittle Construction, said he's begun scheduling subcontractors much earlier than the past. "It used to be that I was able to call someone and they'd show up the next week to do the work," Roberge said. "Now it's a good thing to schedule someone two or three weeks, sometimes four, weeks out, because everyone is getting busier. It's going to be crazy until September." A long-term relationship with his subcontractors is helpful, he said. "I just need to give them a good schedule." Brad Bennington, Home Builders Association of Jackson County executive officer, said the tight labor supply for subs will likely deteriorate before improving. "We've lost so much of our workforce that it's problematic," Bennington said . "We've only got 40 percent of the workforce we had 10 years ago. "The really bad news is that within five to seven years, 50 percent of our present workforce will be retiring because we're all old guys. We don't have anybody in the pipeline to replace the guys that are retiring." Bennington said the shortage runs the gamut from carpenters and drywall hangers to concrete finishers. "We have a real strong demand for vocationally trained people, but we don't have anywhere near the people we need," he said. "As you work down the timeline it gets worse. It's not just a local, Southern Oregon problem, though, it's this way across the U.S." Reid Murphy of R.A. Murphy Construction in Medford said a sure-fire way to develop a wider pool of tradesmen is to increase wages. "When things are cooking there are a lot of people in the trades and a lot more subcontractors to draw from," Murphy said. "The last few years attrition and the economy has taken its toll on our skilled workforce. Even though we still have a good labor pool in the valley, it gets tough when there are multiple projects in the valley, because everybody is working with the same labor pool. "If we're anticipating any kind of of future growth we need to attract some really good tradesmen. Money is a good attractor. Labor (wage) rates are lower here than in the big cities, so guess where they go." Batzer said the shortage boils down to Economics 101 — supply and demand. "Wages have been suppressed for a long time now; if you want to keep qualified help, you're having to pay more," he said. That's assuming you can find qualified help. A decade ago, Bennington said, the Home Builders Association raised $250,000 to back a construction training program at Rogue Community College. "It was just starting to gain traction in 2007, then the demand went away," he said. "If you don't have demand, you don't need a program. Now we have the demand." With the crush of work at the moment it's not necessarily a good time to train newcomers. "You can hire a guy to start from ground up, but it takes a lot of time," Trautman said. "With the volume of work we have, it's almost an impossible situation. You don't see many young guys doing concrete, framing or learning to plumb. Even with all the work here, they're stuck on the computer wanting to do the digital and social media kind of thing. Society has forgotten hard work is supposed to pay off. Younger guys want to sit in front of a computer and make four or five times what I do for nothing." Some subcontractors are hesitant to overextend after being bled dry a few years ago. "Even though a lot of people have plenty to do at this moment, there is still a lot of long-term uncertainty," Mayers said. "They're a little hesitant because they don't know what next year holds for them; a lot of them have downsized. They're making more money and satisfied where they are right now." Because the local ranks are thin, contractors and builders have pulled in crews from other parts of the state. "When we have to import workers from outside of the valley, there are travel costs involved," Mayers said. "There's a project in Klamath Falls where masonry contractors had to be brought in from Portland. When they come down, you have add per diem and travel costs, because they have plenty of work to do at home." As a result, he said, budgets in the public works arena are up as much as 35 percent from this time last year. Tom Hall, president of S&B James Construction Management, said in a normal business cycle, the end of a recession spurs formation of additional private businesses, including subcontractors. There are more obstacles now, he said, ranging from health care costs and sick leave to increased regulations, making it more difficult for start-ups. "Are people willing to step up and start their own company?" Hall said. "Are people willing to put their livelihood on the line and willing to become a small business?" Reach reporter Greg Stiles at 541-776-4463 or [email protected] . Follow him on Twitter at www.twitter.com/GregMTBusiness , on Facebook at https://www.facebook.com/greg.stiles.31 , and read his blog at www.mailtribune.com/EconomicEdge . By Greg Stiles Mail Tribune MailTribune.com By Greg Stiles Mail Tribune Posted Jun. 28, 2015 at 12:01 AM » Comment or view comments Reader Reaction » STAY INFORMED Email NewsLetter Sign Up Today Sign up for our newsletter and have the top headlines from your community delivered right to your inbox. Southern Oregon Directory Featured Businesses Loading... 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