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The Austin View: Construction industry faces challenges as Texas growth explodes

Dave Montgomery
Austin Bureau

managingeditor@bizpress.net

AUSTIN – With thousands of out-of-staters flocking to Texas each day, the state’s robust construction industry has a lot to be grateful for. But the good times are also spawning challenges, say officials representing varying sectors of the industry.
With the 2015 legislative session less than a year away, industry lobbying groups are planning a continued push in behalf of measures to further advance Texas’ enviable economic growth and perpetuate the buildup of adequate water and transportation infrastructure that began in the last legislative session in 2013.
Another priority aims at reversing a shortage of skilled workers needed to supply the rising demand at construction sites sprouting up across Texas. While the Texas oil boom is pumping millions of dollars into oil-patch communities in West and South Texas, it also is drawing away labor needed to build houses, roads and commercial establishments, say construction industry officials.
“It creates a shortage of workers,” says Phil Thoden, president and CEO of the Austin chapter of the Associated General Contractors of America. He points out, for example, that a welder “working for the oil and gas industry” is not available “to put up steel in a commercial building.”


Scott Norman, executive director of the Texas Association of Builders, says Texas’ surging construction industry is the envy of the nation. Homebuilders who comprise the association’s 10,000-strong membership have been enjoying a hefty upswing since Texas began an unwavering rebound from the national recession several years ago.
“We’re glad we’re in Texas,” said the Austin-based official, pointing out that Texas is leading the nation in housing starts for the fifth year in a row. “Folks are continuing to move to Texas. They all need somewhere to live. From that perspective it’s good for folks that are in the business of housing people.”
But, at the same time, he says, the steady onslaught of population in the nation’s fastest-growing state also presents “a lot of challenges,” putting pressure on Texas legislators and policymakers to continue upgrades in roads, water and other infrastructure.
“We have challenges with water supply moving forward (and) the transportation system,” Norman said. “Both of those …affect us directly because it’s going to affect our members’ ability to develop and build new subdivisions.”


A $2 billion initiative approved by the 2013 Legislature and overwhelmingly ratified by voters in November is expected to generate millions of dollars in local projects to help meet Texas water demands for the next half century.
Another constitutional amendment that will go before voters in the November, 2014, election will increase transportation spending by about $1.4 billion per year, but Norman said even more money will ultimately be needed to resolve “some of the transportation nightmares that exist around the state.”
The proposed transportation funding, he said, is only about a fourth of “what the highway folks say they need” to meet the state’s future transportation demands. State highway planners believe the state needs at least $4 billion to $5 billion a year to keep pace, Norman said.


“We want the state to keep doing what it’s doing to keep Texas’ job future bright,” he said.
Industry officials also want the Legislature to expand training for skilled workers to help fill the shoes of aging workers who are nearing retirement. Many of the state’s top-flight plumbers and electricians are in their late 50s and early 60s, say industry experts.
“Finding an adequate work force is always an issue in times like these,” says Thoden. Although the 2013 Legislature overhauled the state’s education requirements to put a greater emphasis on technical training, Thoden said high schools lack “the vocational programs that we used to see to help develop workers for the construction industry.”
“It’s a big issue,” he said.
 

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