Will Houston find enough workers to rebuild after Harvey?

Many south Texas homeowners and businesses will want to rebuild and renovate their water-damaged homes after Harvey’s floodwaters recede. The question is: will they be able to find workers to do the job? 

Before Hurricane Harvey devastated Houston and the surrounding area in recent days, shortages of skilled labor were so bad in Texas that builders estimated it added as much as a month-and-half in additional time to the construction of a new house. 

“You can only imagine that it’s going to be that much worse after the storm,” said Scott Norman, executive director of the Texas Association of Builders, who held a conference call with his members today to discuss the storm, in an interview.

Experts are also warning that scammers offering to rebuild houses quickly or on the cheap may prey on residents eager to fix their damaged properties. 

A recent survey by the National Association of Homebuilders found shortages of some construction trades are at their worst level since 2000. The trade group found more than 70 percent of builders reported difficulty in hiring carpenters, 63 percent had trouble in attracting masons and more than half experienced challenges in finding roofers, plumbers, painters, and electricians.   

General contractors who repair roads, bridges and other large infrastructure projects are in the same situation. A survey released yesterday by Associated General Contractors of America found 70 percent of respondents had a “hard time” filling skilled labor positions.  Another 67 percent are expecting labor markets to get tighter this year.  That’s why half of the firms say they are raising worker pay and another 24 percent are providing bonuses to attract employees.

Construction workers are plenty busy. Overall unemployment is at a 16-year low of 4.3 percent, and employment in the construction sector grew in 258 out of 358 metro areas between July 2016 and 2017. Government data shows there were 225,000 open construction jobs in June.

Builders have complained for years about the difficulties they face in attracting workers. Increasing training opportunities may offer one solution to the problem. According to Norman, the U.S. will need to figure a way to get more legal foreign workers to assist with the Harvey rebuilding as part of a comprehensive reform of immigration law. Other industries have made similar pleas to Congress, although to no avail.  

“We are going to need these people to try and rebuild parts of Texas that have been devastated,” Norman said.

The Pew Research Center estimates that 15 percent of construction workers are in the U.S. without legal authorization, and these are the workers who have been increasingly targeted for deportation by the Trump administration. Finding workers to rebuild after Harvey will also be exacerbated by a shortage of housing in the Houston area. 

According to the Texas Low Income Housing Information Service, Houston is third-worst U.S. metropolitan area when it comes to housing availability for extremely low-income households. To make matters worse, many of the area’s homes also probably not insured against floods.

“One of the things that it did is that it pushed a lot of working people … into suburban areas where it’s cheaper to live but which are often very flood-prone,” said Hany Khalil, executive director of the Texas Gulf Coast Labor Federation, in an interview. “Either they are in flood zones or they are in areas that were not officially flood zones but ended getting flooded anyway because of the scale of the rain.”

Unlike in other areas of the country such as the Northeast, the power of unions in Texas are limited by the state’s right to work law. Fewer than 5 percent of workers employed in home construction are unionized. Most of the members of Khalil’s organization work on large commercial construction jobs, where roughly a third of the workforce is unionized.

“There is going to be a tendency to want to try and rebuild with cheap labor and unskilled labor unquestionably to save on costs,” Khalil said.

After Hurricane Katrina devastated New Orleans in 2005, so-called “storm chaser” contractors and public adjusters descended on the region, ripping off residents, charities, and business owners. The Coalition Against Insurance Fraud expects the fraudsters to show up in the Houston area as soon as the flood waters from Harvey recede and the rebuilding begins.  

“There is simply too much confusion and too many opportunities to make a quick buck,” said James Quiggle, a spokesman for the coalition.

Be cautious of door-to-door salespeople offering reconstruction work, and make sure to check that workers have proper insurance and licensing before hiring them, advises Marla Mock, vice president of operations at Rainbow International, a restoration company that specializes in issues such as water damage. 

The stress of dealing with a damaged home “does cause homeowners to fall victims to scams, especially when people give them unrealistic expectations,” Mock said. “There is going to be a waiting list for individuals who are already certified.”

Qualifications that homeowners should ask for include certificates from the Institute of Inspection, Cleaning and Restoration Certification, or IICRC, which ensures standards for cleaning and restoration work, Mock said. These include certificates for applied drying structural technicians and applied microbial remediation technicians, who can work on mold, water damage and related issues.

Given the expected demand for renovation and restoration work, Mock said homeowners should be reaching out to contractors now. 

She added, “They need to get on the list as quickly as possible so these mitigation services can be tended to.”

Source: CBS News – Moneywatch

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