Construction spending nationwide in August reached a seven-year high, according to a study released Oct. 1 by the
Associated General Contractors of America.

But despite the good news, an association news release says that the increase in demand for construction could add to a problem many firms are having – finding qualified workers.

“There were widespread monthly and year-over-year gains in August for all major construction categories – private nonresidential, residential and public,” said Ken Simonson, the association’s chief economist, in the release. “Activity in all three categories has been accelerating recently and should continue rising into 2016 – if contractors can find enough workers with the right skills to complete the projects under way and currently being designed or financed.”

In the Wilmington area, the decline in construction employment in August this year compared to last, shown in an analysis of federal data by the AGC of America, wasn’t nearly as steep as some in other parts of the state and nation. The Wilmington metropolitan statistical area lost 200 from its construction, mining and logging employment figure, the data shows, decreasing from 6,500 to 6,300, while Raleigh’s number of employees in that category fell by 1,100 in the year-over-year comparison.

Local contractors say they have been able to complete their projects with smaller crews.

“Everybody’s probably as busy as they were six, seven years ago before everything fell apart, but the crews are not as big to handle the work because everybody is scared to keep that kind of overhead in fear that the industry could fall again,” said Yates Chambliss, vice president and Wilmington division manager for Chambliss & Rabil Contractors Inc. “But at the same time, I think we’re making it work.”

Scheduling is key, he said.

“The amount of business we’re turning out is equal [to earlier years], but we’re just doing it with less people and more efficiently. It’s stressful, but at the same time, it’s not a huge problem if you know how to manage your crews,” Chambliss said.

“If you’ve got a good project manager, and you’ve got good subcontractors, you take the crew you’re given and you manage it accordingly.”

Recently, Chambliss’ company has been working on four ground-up projects, including a new, 6,000-square-foot office building on Market Street that will be occupied mainly by Jackson Hewitt Tax Service, with other tenants in the remaining space.

Chambliss said when the Jackson Hewitt office is finished, between 75 and 100 workers will have helped to pull it together.

Weather, Chambliss said at the end of September, as steady rain drenched the coast, can be a bigger problem than labor shortages for projects in the Cape Fear region.

Ultimately, though, “we’re as busy as ever, so that’s a good thing,” Chambliss said.

Ken Dull, president and owner of McKinley Building Corp., said local companies have not found a labor shortage problem on larger projects for two main reasons.

“One is that the larger projects require mostly out-of-town labor,” Dull said in a recent email.

The other reason, he said, is that the work is planned out far enough in advance with subcontractors that they can staff accordingly.

In general, Dull said of the industry, there has been a small amount of upward pressure on pricing.

“I think that in larger markets, where there is more demand, pricing is going up faster,” he said. “The workforce that we had before the downturn has not reappeared and therefore has put pressure on the ability to keep up with the new
surge in growth.”

That growth, according to the AGC of America, in terms of construction spending was 13.7 percent higher in August than it was during the same period the previous year, with spending for the month this year totaling nearly $1.2 trillion.

“There has been exceptionally strong growth in manufacturing, lodging and apartment construction all year,” Simonson said in a news release. “More recently, office, health care, highway and educational structures have rebounded as well.”

What AGC of America officials are worried about, according to recent news releases, is the impact an ongoing worker and skilled-worker shortage throughout the country could have on the industry’s future.

Construction firms could be forced to propose slower schedules for vital projects if they struggle to fill important positions, an outcome that could have a tempering effect on the economy as a whole, according to the AGC of  America’s Workforce Development Plan.

“While it is great to see growing demand for construction, many firms won’t benefit if they don’t have enough workers to get the job done,” said Stephen E. Sandherr, the association’s CEO.

“Without a better approach to attracting and preparing future construction workers, construction projects are likely to get more expensive and take longer to complete.”