3/3/2015 Where Have All the Construction Workers Gone? ­ The Atlantic

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LAS VEGAS—The buzz and hammering of construction has returned to this city,which was especially hard hit by the housing bust. The construction workers,however, have not.

At the peak of the boom, Nevada employed 146,000 construction workers,according to the Bureau of Labor Statistics. Now the state employs only 63,000,a 59 percent decrease—and a two­decade low.

That’s led to some labor shortages, says Nat Hodgson, the executive director ofthe Southern Nevada Home Builders Association. “The actual skilled workersbuilding the houses—it’s a challenge finding them,” he told me. “It’s hard toentice them to come back until we can convince them we’re really going to startgrowing again.”

It’s not just Nevada. Nationally, construction employment is down 19 percentfrom its 2007 peak. The decline is particularly stark in areas hard hit by thehousing bust. In Arizona, construction employment has fallen 50 percent fromits pre­recession peak; in California, employment has dropped 28 percent in thefield. In Florida, construction employment is down 40 percent.

Across the country, there are 1.4 million fewer people employed in constructionthan there were in 2007, data shows. But only 811,000 construction workers

Where Have All the ConstructionWorkers Gone?Nevada now employs 60 percent fewer construction workers than it did during the housingboom. Some found new careers. Others left the country.

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3/3/2015 Where Have All the Construction Workers Gone? ­ The Atlantic

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M O R E F R O M

actually show up in unemployment­report data. To be sure, there are differencesin the way these two data sets are collected that might account for some of thediscrepancy, but it raises an interesting question: What happened to all of theconstruction workers felled during the housing bust?

James J. Mikulich may provide one clue. His family has lived in Nevada formore than a century, prospering in industries that built the region, such aslogging and transportation. He was in the tile and marble industry for 25 years,installing floors and interiors in homes and hotels. Then in 2012 he blew out hiship and had to have replacement surgery. While he was rehabilitating his leg, hehad a revelation.

“The economy was downturning real bad, construction was at its lowest point in30 years, and I said, I don’t want to enter back into that,” he told me.

One morning, after waking up at 4 a.m. and doing his stretches, he had an idea.He opened the Sunday careers section in the newspaper, called on a higherpower, and then closed his eyes and put his finger down on a random place onthe page, deciding that whatever career it suggested, he’d pursue.

His finger landed on an ad for a massage­therapy program at a local careercollege.

“I said, ‘What’s a better thing than to be able to help somebody out—help theelderly, help the athletes, make a difference?’” he told me.

He went down to the school, the Milan Institute, and got more information, thenstarted doing the pre­requisites that would allow him to enroll in the eight­month, 720­hour course to become a licensed­massage therapist.

It was tough transitioning back to being a student in hisfifties, Mikulich said. He was worried about his abilityto learn new things such as anatomy and kinesiology,and feared that when he graduated school, he’d flunkthe certification test. But he continued to get up at 4a.m., do his hip rehab, go to school from 8 a.m. to 1p.m., and then go home and study.

Before the certification test, he took over one room inthe home he shares with his elderly mother and told herhe needed total silence to study for the month before the test. And he passed. Henow works as a massage therapist at Las Vegas conventions, boxing

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competitions in town, at a beauty salon, and on a freelance basis.

Mikulich, who is now 54, was probably more easily able to transition careersthan many construction workers: He could go to school full­time because he'dsaved up some money and because his children were grown. Being a full­timestudent allowed him to receive a Pell Grant that covered about one­third of the$12,000 cost of the program. He also cashed in some retirement accounts to payfor school.

For most unemployed workers, getting together the resources to go back toschool can be extremely difficult, especially if they’re trying to support a family.That’s because many construction workers—and others displaced by therecession—spent their savings paying the bills while they were out of work. Inone survey, only 15 percent of unemployed workers said they had enrolled intraining programs that would help them gain new skills to find a new job. Andonly about 100,000 to 150,000 dislocated workers—people who have lost theirjob and are unlikely to return to that occupation—receive retraining from federalfunding each year, according to Carl Van Horn, the director of the HeldrichCenter for Workforce Development.

“There’s not a lot of government support for these programs,” he told me.

The government spends $30 billion on Pell Grants, which don't have to berepaid, but those are for full­time students. Mikulich told me that he felt luckyhe was able to get a Pell Grant because he didn’t have to work while going toschool.

“If I had to work and do the program simultaneously, it might have been aproblem,” he said.

Most unemployed workers can't use Pell Grants to go back to school if they wantto keep receiving unemployment benefits to help pay the bills. To qualify forunemployment benefits, they have to prove that they’re actively looking foranother job, not going to school full­time.

There are some federal funds available to dislocated workers, especially thoseput out of work because of trade deals, said Andy Van Kleunen, the CEO of theNational Skills Coalition. Some of those funds go to advising workers about newjob options, and others actually pay for technical training or helping peopleimprove math and reading skills.

There's about $1 billion available for training dislocated workers each year, hesaid. On average, students can get about $3,000 through the program.

The Workforce Innovation and Opportunity Act, passed by Congress last year, isexpected to expand some of these retraining programs. The Ready­to­Workinitiative, introduced by President Obama in his 2014 State of the Unionaddress, also expanded access to apprenticeships in high­demand industries andseeks to make training programs more job driven. Some nonprofit and union­ledtraining initiatives have already received grants through that program.

3/3/2015 Where Have All the Construction Workers Gone? ­ The Atlantic

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Still, there’s more need to make sure there are jobs for people that go throughretraining before students spend thousands of dollars on a program that leadsthem nowhere.

“There are some really good, proven programs that work out there,” VanKleneun said. “But I would not say that they are the rule in all circumstances.”

Many displaced workers don’t know there are potential funds available to them.

Mike Farren, now 30, is spending between $15,000 and $20,000 to transition toa career as a physical­therapist assistant. He had worked at a steel factory inIndiana making structural eye beams for buildings and bridges. He wascompensated based on production, so when the economy slowed, his pay rateslowed, too.

“As a career, it can be an unstable field to be in, and I just kind of made up mymind that I didn’t want to have to worry about that,” he told me. “Wheneverything tanked in '08, it showed how quickly that job could be gone.”

Farren started looking into programs that could help retrain him in anotherfield, and ended up moving to Las Vegas because a program at the College ofSouthern Nevada was the least­expensive one he could find, and because thecost of living in the state was so low. He is paying out­of­pocket for the program,from his savings, and won’t make as much as he did before once he’s completedthe program. But it’s worth it to be in a growing field, he said.

“It wasn’t all about money,” he said. “I made a lot back there, I know I can liveon a lot less than that.”

Many people who used to work in the construction field have moved around agood bit since losing their jobs, sometimes to other states where they could stayin the field. Mikulich told me he had friends in the industry who had moved toNew York, Pennsylvania, and Phoenix. While reporting from North Dakota a fewyears ago, I ran into numerous men who had moved there after losing their jobsin construction somewhere else.

Overall employment in North Dakota has grown by 30 percent since therecession began, and construction employment has doubled. One labor­unioncoalition even banded together to recruit construction workers to North Dakota.Construction employment in Texas is up 18 percent since 2010, and has nearlyreached its pre­recession peak.

Vice President Joe Biden checks out a community college dental-hygiene program. (MarcusYam/Reuters)

3/3/2015 Where Have All the Construction Workers Gone? ­ The Atlantic

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Some workers who had immigrated to the U.S. for work in construction may alsohave returned to their home countries when the recession hit. A report from thePew Hispanic Center found that during the economic slump, for the first time infour decades, more Mexican immigrants left the U.S. than entered it. Andconstruction­heavy states including California, Arizona, Colorado, and Nevadalost unauthorized­immigrant workers between 2009 and 2012, according to aseparate Pew report.

Latinos made up 24 percent of the construction industry in 2011, and theindustry was the sixth­largest employer of Latinos, according to the NationalCouncil of La Raza. Some of these declines could be the result of laws such as SB1070 in Arizona, which required police to question anyone they believed to be inthe country illegally.

Often, a worker’s fate would depend on whether he was skilled or unskilled, saidCindy Creighton, the executive director of the Nevada SubcontractorsAssociation. Many unskilled workers would refer family members or roommatesto jobs, and then they all would be dramatically affected during job cutbacks,Creighton said.

“When four, five, six people in a family lose work, they had no choice but to leavethe area, or change professions,” she said.

There is a certain irony, though, that so many people had to leave construction,though, since the industry is now so short­handed. “Everybody’s just screamingfor labor—you can literally go door­to­door, fill out your application, do your e­Verify, and go to work,” she said.

Whether that means people who left construction during the recession shouldcome back is up to them. James Mikulich says he still drags his feet across tilefloors, looking for uneven workmanship, and likes to linger over marble.

“People are like, ‘Why are you touching that marble, James?’” he said. “But I usethat same formulation when I touch somebody—I touch their leg and they say ‘Ihave pain or some dysfunction,’ and I say ‘How can I help them, how can I makean impact on their life?’”

Still, for others, returning to construction might not be a bad bet. The Bureau ofLabor Statistics projects that occupations in the healthcare and constructionfields will be some of the fastest­growing jobs between 2012 and 2022.

A job-posting board in Nevada advertises for construction workers. (Alana Semuels)

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Healthcare is expected to grow at a rate of 2.6 percent a year—construction willgrow at the same rate. But though the construction sector will add 1.6 millionnew jobs over that decade, economists said, the industry still won't return to its2006 peak level, even by 2022.

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ALANA SEMUELS is a staff writer at The Atlantic. She was previously a national correspondent forthe Los Angeles Times.

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