A word with Wayne Hammon, CEO of Idaho Associated General Contractors

Wayne Hammon, CEO of the Idaho Associated General Contractors, issued an economic overview of construction firms in Idaho and their ongoing need of employees at the beginning of October, based on an analysis by AGC of America’s Chief Economist Ken Simonson. The Idaho AGC is the largest organization of construction professionals in the state.

The AGC numbers showed that the number of Idahoans employed in construction has reached a two-decade high and now topped pre-recession levels. AGC estimated that there are 54,200 construction workers in the Gem State and that figure has grown 2.1% over the last twelve months despite economic pressure created by the state’s response to the ongoing pandemic. The growth in Idaho’s construction industry stands out when compared to a 4.1% decline in the construction industry’s employment nationwide.

The Idaho Business Review interviewed Hammon to explore his insights on the construction business in the state and the prospects for employment it can currently offer to those who may be looking for work.

Looking at the numbers in your news release, you pointed out that there are around 706,000 construction firms in the U.S., including about 6,900 in Idaho. That means that Idaho has about 3.7 construction firms per 1,000 people as opposed to about 2.2 firms for the nation as a whole. Why is that?

Construction companies in Idaho — not all of them, but most of them — tend to be smaller family-owned operations, and even some of the largest construction companies in Idaho are family-owned operations. They’re Idaho born and bred and they grew up here. Now we do have big national players here who have offices, and lately there’s been a great interest in folks from outside of Idaho coming to set up shop here because we’re one of the few bright spots in the nation; but for the most part, the construction companies in Idaho tends to be smaller family-owned businesses.

Do you think that big national firms moving in is necessarily a good thing? As we’ve seen over the last few decades that the consolidation of firms in a sector can end up not being a good thing, especially for the smaller local businesses they compete with.

As our population centers grow, Idaho will continue to be noticed by large national firms. Fortunately there’s work here for everyone at the moment. We’ve also seen where out-of-state construction companies are partnering with local contractors. This gives the partnership the local expertise they need to thrive and do well in Idaho; and it gives the Idaho partner the access to a lot more capital and experience. So by partnering with these large firms, an Idaho firm can expand its work doing larger jobs and tackling bigger projects; and the outside firm gets an introduction to what it’s like to work in Idaho. So I don’t see it as a threat. I see it more as an opportunity for partnership. At the end of the day, construction remains an industry where your personal knowledge, expertise and know-how still accounts for a lot of the work.

I’ve covered several stories going back at least three years that indicate the construction sector in Idaho can’t get enough people to fill all the positions that are available. It still looks like that hasn’t changed over the last year and that we still don’t have enough people to hire in the construction trades.

That remains our number-one concern. When I think about Idaho’s growth in construction, the most significant limiting factor its growth and to construction employment is the availability of talent. There is a lot of work to be done in Idaho; but unfortunately I fear there are people trapped in low-wage jobs that don’t understand they could be making a lot more money and have a much, much more meaningful career in construction if they just knew the work was available. We’re hoping to get that story out, to let people know that we are hiring. Despite COVID-19, despite all the kinds of troubles, the construction community is hiring. There’s plenty of opportunity for people at all skill levels to find a career in construction.

How hard is it? For example, if somebody lost their job in some other field, how hard is it to get training, to get a decent construction job?

There are several ways that people enter the construction industry from other sectors of the economy. We have posted a job board at webuildidaho.org. The jobs range from specialty skills to general labor. A lot of people find their way through that front door. They may have hired on just to work on a construction site. They help carry things and they help pour concrete — and as they do that, they learn the skills. They get teamed up with a more experienced team and then they learn the skills and work to move up the food chain. Somebody who can show up on time, work hard and pass a drug test can be a supervisor in six months if we’re thorough with the job training.

All Across Idaho, there’s also apprenticeship programs, both with the unions and with merit shop contractors; and those will bring somebody in to train who has hardly any skill at all. Over time, these give people the training they need; and with that comes certain payroll benchmarks, where people are moved up as they learn more. The more they learn, the more they make.

It’s great if somebody shows up and already knows how to weld, right? If they took a welding class in high school, then you put them to work. If they’ve got a CDL already, they can start working tomorrow. If they don’t have a CDL and they want one, there are certain companies in Idaho that will pay that person’s wage for them to go take the training to be certified so that they can drive trucks. If you can wait tables, I think you can probably find a job on a construction site. We even have a hard time finding flaggers. All it takes is a two-day course and someone can be making $20 an hour. That’s pretty good if you’re stuck making $9.50 flipping burgers. You can get a job tomorrow. There are construction companies that will pay the fee for you to go take that course. They need people that badly.

What about factors that prevent people for taking Idaho jobs in the trades? Here’s an example for you. I know of a firm in Blackfoot that does a lot of steel work. They need welders but when they’ve tried to hire experienced welders from out-of-state, they’ve been turned down by some of the people they want to hire because there’s not enough affordable housing in the area. How do you attract people to work in Idaho if they can’t afford to live here? This isn’t a problem just in eastern Idaho. How bad is this problem in Boise or Coeur d’Alene?

Yes, the affordability of housing is a factor; and I would say that transportation is also a limiting factor as well. Construction jobs are somewhat mobile. You may work on a construction site for two or three months, but then your next job is going to be across town or on the other side of the valley. So from the first, a worker has to have a reliable mode of transportation — either his or her own car, or a friend or something. They’ve got to have a reliable source of transportation. That’s a challenging factor as well.

Now, the affordability of housing all across Idaho, in large communities and in small ones, is not only a challenge for our industry but for every industry. We’d like to see more done on that front. Our own AGC members have built a lot of multi-family housing. It seems that here in the Valley at least, we cannot build multifamily housing fast enough. I know apartment complexes that are completely rented before they even get the roof on board.

That’s actually one of the bright spots when I say that Idaho has continued to be a bright spot for construction. Multi-family housing is right at the front of that, along with single family. The home builders have so much work that they can’t even take a break — but the multi-family family market is also very heavy and very hot as well.

You had some numbers and a graph that went with your news release that showed that Idaho’s construction employment right now has matched its previous peak, which was back in 2006 to 2007.

It looks like that peak was 2006, 2007, and now we’re matching it with 54,200 people employed in construction in Idaho. That graph doesn’t go back into the 90s so I’d have to go back and look to see if there was a peak back then that was greater than now.

We were at a peak right before the big recession in 2008 and basically, we’ve, we’ve reclaimed all of that ground. 

But it was a very fast decline in 2008. We went from over 50,000 working to around 30,000 in two years. Then it’s taken us 10 years to get back to where we were before the recession.

The fact that we’re still going up with employment while we’re in the middle of this economic downturn from the pandemic is very impressive.

Yes, it is. When you consider what’s happening in other states and the loss of jobs that we’ve seen in lots of  communities, it seems to bear out what we’ve been hearing: that investors are still very keen on Idaho. They’re still wanting to build here. They’re still wanting to invest here. You know, nothing gets built for free. Each one of these construction workers in Idaho is working on a project that was financed by someone; and for these investors to commit to spend that much money means something. It means they have a faith in Idaho.