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Election 2012: The elephant in the room for home builders

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Election 2012: The elephant in the room for home builders

August 21, 2012

I travel this country meeting with builders virtually every week and between my monthly Professional Builder article, my weekly blog on HouzingZone.com and our Lean Building Group on Linkedin.com, I hear from many more. As housing is picking up in most parts of the nation, I am beginning to hear a lot about labor shortages. Just last week I received a note from a builder lamenting how in central Florida there is a bidding war for framers and drywall contractors. I have also heard it coming out of Texas. Considering that pretty much the only thing we get from politicians is how they are going to make it MORE difficult for non-citizens to enter this country, this situation suggests dire consequences for homebuilding. And no one is talking about it. Not any of the industry magazines and certainly not NAHB.

The reality is that Hispanic-origin workers are a large portion of crews in concrete forming, finishing, framing, drywall and landscaping and are significant in a number of others. Talk to any owners of these trade contractors and they will tell you that they simply don’t get many non-Hispanics seeking work. As states pass more legislation to aggressively pursue document checking of such workers, increase enforcement and deportation, it all gets worse. So what’s going to happen?

I see three choices. First, leave it alone and let the bidding wars begin – not a very Lean approach but a rather interesting concept; let the free-market economy dictate the allocation of a (mostly) illegal workforce. Second, raise wages to the level where non-Hispanics are attracted back to these trades. I will let you all ruminate on the implications of that one but it would sure get builders fired up on the issue. Third, initiate a “guest worker” program that allows non-citizen workers to get here legally, and stay here while legitimately employed. What???

Already, some of you have branded me a flaming lefty just for mentioning the third option. I am a passionate member of the “Party of the Totally Disenfranchised” and on any given day I can be just as disgusted by the Republicans as I am by the Democrats. So don’t start with the emails on that, please. What I am doing is raising an issue that has the potential to go nuclear and mess with a lot of the efforts builders have made over the past 6 years to get truly efficient. It plays really well on TV and radio these days for politicians to proclaim, in so many words, their intention to throw “those people” back across the border while no one engages in serious consideration of the consequences for our industry and many others, including hospitality, healthcare and food processing, to name just a few.

The problem is that politicians of both the Left and the Right won’t touch the issue, being the proverbial political 3rd-rail. The Right, by and large, rails against anything suggesting a non-resident set foot in this country, even if it is to pick crops, dig ditches or clean up after old folks in retirement homes, jobs that our own citizens don’t seem to want to do. Remember what happened when George W. Bush suggested a guest worker program? He was promptly skewered by those of his own party.

And on the Left? Unions oppose guest worker programs because they see these workers as a threat, even though they work in jobs that are largely not unionized. And Left-leaning politicians are completely gutless to bring it up, because to suggest some form of legitimizing non-citizens in work roles will promptly get you labeled as un-American, not to mention a hater of freedom, democracy and probably your own mother, on 100 websites, blogs and by TV pundits by nightfall.

It is thus eminently predictable that neither Obama nor Romney will touch this issue in any substantive way. Perhaps in your state and local elections someone will take a stand, but it is really Federal-level resolution and action that is required. This is not a Left or Right issue. For us it is a Homebuilding issue, and we’d better start pressuring our political leaders to do something about it. If not, I predict within a year there will be a lot more pain, gnashing of teeth and blame-tossing as the trade shortages exacerbate and we all wonder what hit us.

written by

Scott Sedam


Scott Sedam, president of TrueNorth Development (www.truen.com), spends most of his time working in the trenches with builders, suppliers and trade contractors. His Lean Builder blog appears weekly at HousingZone.com. He welcomes your feedback at scott@truen.com.

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