The high cost of living in California’s Bay Area is legendary. And with the construction industry facing a number of challenges — including the need to rebuild after horrific wildfires — that’s set to only rise.
Developers are having trouble getting their projects finished — or even started, reports CBS affiliate KPIX. One construction foreman told the station he’s four to five weeks behind schedule on his site.
A nationwide survey released this week by Autodesk and the Associated General Contractors of America shows the scope of the problem. Some 80 percent of construction companies say they’re having a hard time filling hourly craft positions. Those include bricklayers, installers, pipelayers and carpenters. And more than half of companies are having trouble filling salaried positions, like project managers, engineers and architects.
“This is about money — they want to make a living,” said construction worker Jimmy Ramerez.
Contractors aren’t expecting relief anytime soon. Nearly half of employers in California say it will become even harder to hire over the next 12 months.
On top of the already-tight labor market, the Bay Area is also contending with natural disasters. Last year, wildfires in neighboring counties destroyed more than 5,000 structures. This year’s fires are on record as the largest in California’s history.
In the North Bay, construction workers are being paid top dollar to help repair fire-ravaged communities, which pulls more people away from the Bay Area.
“They’re poaching our guys and offering more money per hour to go and work for them,” the foreman said. “They’re leaving us high and dry.”
Materials costs, driven up partly by tariffs, are also part of the squeeze. Developer Eric Tau said he has seen an increase of 10 percent to 15 percent in costs — about triple the jump he had expected. “It’s something we have never seen in all of our 15 to 20 years in construction development,” he said.
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