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The following article originally appeared in the November newsletter to clients of Kiley Advisors, LLC for the purpose of providing the latest leading indicators and industry issues to those clients. Reprinted with permission.The worst is likely behind us. At least that was the sentiment around a panel of economists discussing Houston’s economy. While the recovery will be slower and longer than previous recessions, barring an unforeseen event, it appears that Houston is beginning to recover.The focus of the panel, instead, was on how far Houston fell before the change in direction. An early re-benchmark of the employment numbers by the Federal Reserve Bank of Dallas shows employment numbers from the Texas Workforce Commission will likely be revised down, though how far is anyone’s guess.
Reshaping the Construction Industry
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Leaders in the commercial construction industry in Houston have a lot to be thankful for despite a state and global economy that is struggling in many ways. Houston – along with the rest of Texas – has been hit hard by the downturn in energy but the economy here is much more diversified than it was during previous oil busts. Improvements in sectors like health care and real estate have helped to blunt some of the economic damage incurred by oil and gas as well as manufacturing.During a conference presented by Kiley Advisors this past week, consultants Pat Kiley and Candace Hernandez told construction executives that while the rate of global economic growth is slowing, there are bright spots that will keep builders here quite busy.Texas has added 1.8 million people since 2010 and a little more than 14% of the state’s economy is now energy specific or energy-related. Job growth has slowed overall, with about 167,000 jobs added in 2015 after more than 361,000 were added in the previous year. GDP growth for 2016 is expected to be 1.6 percent, down from about 3 percent in 2015.Unfortunately, “Houston continues to be the weak sister,” Hernandez said of the unemployment numbers in metropolitan areas around Texas. Unemployment in the Bayou City is 5.7 percent, compared with 4.1 percent in DFW and San Antonio, and 3.5 percent in Austin.
November 02, 2016
SER-Jobs for Progress (SER) is expanding its operations in Houston, bringing new occupational training opportunities to low-income individuals in the area and providing employers with a new pipeline for recruiting skilled workers.SER, a local non-profit organization specializing in workforce development, is renovating a property at 1710 Telephone Road in Houston’s East End to create the agency’s new Workforce Opportunity Center.“We want to create a community hub where residents can access education, training, support services, and jobs,” said SER CEO Nory Angel. “It will also be a place where employers can recruit, interview, and hire candidates by partnering with our team to help meet their business’ workforce needs.”
November 01, 2016
Construction pay appears to dip; other costs are mixed; injury rate declines againEditor’s note: Construction Citizen is proud to partner with AGC America to bring you AGC Chief Economist Ken Simonson's Data DIGest. Check back each week to get Ken's expert analysis of what's happening in our industry.Compensation costs (wages, salaries and benefits, including required employer payments such as unemployment and workers compensation) in private industry in the third quarter of 2016 (Q3) increased 0.5%, seasonally adjusted (after rising 0.5% in Q2), and 2.3% over 12 months, the Bureau of Labor Statistics (BLS) reported today. Wages and salaries also rose 0.5% in Q3 (vs. 0.6% in Q2) and 2.4% over 12 months.
October 31, 2016
Hanging and finishing drywall is not easy. It is a skill that takes 10,000 hours or more to master. Skilled drywall craftsmen and women are usually known only by the quality of the finished product they produce. Their names are seldom known or carved into stone at a finished building, but they are true artists.
October 28, 2016
Thursday, October 20, 2016, was a star-studded night at the Wortham Theater Center as some of the finest in the construction industry were honored at the Associated Builders and Contractors Greater Houston Chapter’s (ABC) annual Excellence in Construction (EIC) Gala. Member companies submitted their best work to compete in various categories while hoping to win the coveted traveling award: Best of Houston Talk about bragging rights! More than 300 guests attended the dinner and ceremony. The charismatic Spencer Tillman, former running back for the Houston Oilers and San Francisco 49ers, was the event’s emcee. Anxious finalists and guests were treated with light-hearted jokes and words of encouragement as he announced the ICE (top award) and Merit (second place) award winners throughout the night. To keep the voting fair, an outside firm was chosen to decide the Best of Houston award winner. D.E. Harvey Builders was awarded the Best in Houston Award for the Five Oaks Tower/BHP Billiton Tower project.
October 27, 2016
35 states add jobs in September; Dodge predicts starts will rise in 2017; ABI slips againEditor’s note: Construction Citizen is proud to partner with AGC America to bring you AGC Chief Economist Ken Simonson's Data DIGest. Check back each week to get Ken's expert analysis of what's happening in our industry.Seasonally adjusted construction employment rose in 35 states from August 2015 to August 2016 and fell in 15 states and the District of Columbia, an AGC analysis of Bureau of Labor Statistics (BLS) data released on Friday showed. Iowa again led in percentage gain (18%, 13,700 jobs), followed by Colorado (13%, 19,400), Hawaii (11%, 3,900) and Idaho (11%, 4,200). The most jobs added were again in California (30,900 jobs, 4.2%), Florida (22,800, 5.2%) and Colorado. Wyoming had the steepest percentage loss (-9.2%, -2,100), followed by Kansas (-7.7%, -4,700), Montana (-6.9%, -1,800) and North Dakota (-6.3%, -2,100). Kansas lost the most jobs, followed by Alabama (-3,500, -4.3%) and Pennsylvania (-2,600, -1.1%). For the month, employment rose in 21 states and D.C., shrank in 24 states and was unchanged in five. (AGC's rankings are based on seasonally adjusted data, which in D.C., Hawaii and five other states is available only for construction, mining and logging combined.)Dodge Data & Analytics released its 2017 construction outlook on Thursday, forecasting that "total U.S. construction starts for 2017 will advance 5%..., following gains of 11% in 2015 and an estimated 1% in 2016.
October 26, 2016
Experts are downplaying any possible link between the recent vote by the United Kingdom to leave the European Union and the slowdown of British construction in August.Construction output fell by 1.5% in August after it had gone up just a tick in July, according to the Office of National Statistics. A Reuters poll of economists had shown an expectation of an increase of .2%. The Guardian put it this way:The ONS cautioned that monthly data could be choppy and noted that the drop in construction in August had been driven by a 5.1% fall in infrastructure output.
October 25, 2016
This is the first in a series of posts that will focus (sometimes with a bit or bite of humor) on the games that some GCs and subs play on your jobsite while they are working on your projects.We are interested in exposing some of the dangerous, costly, and frankly, stupid practices in an attempt to make you aware and to encourage the industry to improve its practices in the future.Let me start by relating a simple story that I saw happen on one of my first multifamily projects. Let me call it “now you see it, now you don’t.”As a rookie architect, I was sent to a site in Dallas where a client was building a garden apartment project for our biggest private client. Not only was this particular developer the firm’s largest client, he was also the “most profit-minded client” (read cheapest).
October 24, 2016
Last month, I visited Lone Star College North Harris (LSC-North Harris) and spoke with Erica Jordan, Executive Director of Career and Technical Education about the skilled trades training programs at LSC and about the Construction and Skilled Trades Technology Center which is currently being constructed on that campus.In her office on the Lone Star College-Tomball campus, Jordan advises students and works with representatives from the industry to advise them of potential hires which are coming out of the LSC programs and what particular skill sets each of them have.Jordan works with a variety of programs offered by Lone Star College, including their Allied Health programs, Construction Trade programs, ATCP (Alternative Teacher Certification Program), and FastTrack non-credit programs.
October 21, 2016
