Muskegon ranks 4th nationally for construction job growth, but workforce challenges persist

BY Tuesday, September 06, 2022 04:30pm

Construction employment in the Muskegon metropolitan area grew at the fourth fastest rate nationally from July 2021 to July of this year. 

That’s according to new data from the Associated General Contractors of America, which also released a separate survey last week detailing the difficulty construction firms have in finding labor. 

Compared to a year ago, firms in Muskegon added 400 construction industry jobs as of July, bringing the sector’s total employment to 3,000 jobs across the county. 

That year-over-year growth rate of 15 percent has Muskegon tied for fourth place nationally along with Albuquerque, N.M., Grants Pass, Ore., Houston-The Woodlands-Sugar Land, Texas and Provo-Orem, Utah, according to the AGC. 

The only metros to experience higher rates of growth in the construction industry were Cheyenne, Wyo. (17 percent) and Bloomington, Ind. and Duluth, Minn. (16 percent).

Nationwide, AGC reported that construction employment increased in 70 percent of all metro areas as of July. 

“It is good to see construction employment top year-ago levels in more than two-thirds of the nation’s metro areas,” AGC Chief Economist Ken Simonson said in a statement. “However, the record number of construction job openings at the end of June and the near-record low for construction unemployment, as well as our own survey, indicate industry employment would have been even higher if there were enough qualified workers.”

Outside of Muskegon, growth in construction employment elsewhere in the West Michigan market was more anemic, with only Grand Rapids posting positive momentum. 

The Grand Rapids-Wyoming metropolitan statistical area (MSA) added 900 jobs on a year-over-year basis, bringing construction employment to 28,600 jobs, up 3 percent from July 2021. The Battle Creek MSA added 100 jobs to 2,100, up 5 percent.

However, construction employment in the Kalamazoo-Portage and Niles-Benton Harbor MSAs was flat on a year-over-year basis. 

AGC executives said employment gains should be higher given the new federal investments in infrastructure, the need to build capacity in manufacturing, and growth in the energy sector, but were being held back by workforce shortages. 

To that end, AGC also released the results of a survey last week that found 93 percent of construction firms currently have open positions they’re trying to fill. Of those firms, 91 percent expressed that they were having difficulty filling positions, a pinch point that was particularly acute for the craftspeople who perform onsite construction work. 

As well, more than three-quarters of surveyed firms said candidates either lacked the necessary skills to work in the industry, or could not pass a drug test. 

“These shortages are exacerbating the impacts of widespread supply chain disruptions that have made it difficult for firms to get materials delivered on time and that are driving up the cost of those materials,” Simonson said in prepared remarks discussing the survey results. 

As a result, 58 percent of respondents reported canceling, postponing or scaling back projects, and another one-third reported lengthened or uncertain completion times. 

Analysts at Autodesk, which conducted the survey, also indicated that the situation could get worse in the near term as demographics in the construction industry continue to shift, but not all hope is lost given some of the decisions firms are making currently. 

“While the majority of construction firms today are struggling to find skilled workers to fill open jobs, the labor shortage is only going to intensify as more workers retire,” Allison Scott, director of customer experience and industry advocacy at Autodesk, said in a statement. “What’s inspiring is that construction firms recognize this and are taking a proactive approach to preparing future workers for careers in construction. The renewed investments in career development and training programs, as well as a focus on digital skills demonstrates that the industry is committed to taking action to build the next generation of the workforce.”

One proactive approach locally is taking shape at the West Michigan Construction Institute, located at 801 Century Ave. SW in Grand Rapids. The project, an initiative of the Associated Builders & Contractors’ West Michigan chapter, features a construction lab and classrooms, and the organization plans to use for talent recruitment, skills development and job placement. 

The Institute in 2021 estimated that West Michigan’s construction sector will grow by almost 16 percent in the next decade, but nearly half of the industry’s workforce expects to retire within the next 15 years, as MiBiz previously reported.  

Autodesk’s Scott said that such learning initiatives will be crucial to addressing the labor challenges in the years ahead. 

“Construction learning initiatives are being employed to help companies move fast, so they can remain competitive and stay ahead of the curve during the industry’s digital transformation,” Scott said in prepared remarks at the release of the survey data. “This is a promising trend that sets the industry up for increased growth.”

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Read 2786 times Last modified on Tuesday, 06 September 2022 17:33