Business: Boom & Shortage

Running in its own cyclical groove, which is about twice as long as that of the general business cycle, the building industry last year recovered to about the 1931 level. Since the peak of the last boom was hit not in 1929 but in the middle 1920s this recovery was spectacular only in comparison with its incredible Depression prostration. F. W. Dodge Corp.’s figure for all types of construction in 1936 in the 37 States east of the Rocky Mountains was $2,675,000,000 as against $1,844,000,000the year before, $1,255,000,000 in 1933. Residential building, which reached a low of $248,000,000 in 1934, was up to $801,000,000. About 260,000 new homes were built compared to 75,000 in 1935. Yet last year the U. S. spent less than $12 per capita on new housing as against $61 at the height of the home-building boom in 1925.

Released last week, the Dodge figures for January 1937 showed that while approaching at an accelerated rate, the long-awaited building boom was still well around the corner. Residential contracts for the month were 20% ahead of December and more than twice the total for January 1936. But it is estimated that only 425,000 new U. S. homes will go up in 1937, barely enough to care for replacements and normal population growth without touching the huge housing deficit accumulated in the last few years. Old England, with less than one-third the population of the U. S., has been building 300,000 homes year after year.

Even if the U. S. decided to catch up on its housing deficit, there is growing doubt whether it could now rustle enough skilled labor to do the job in a hurry. Even last year reports of labor shortages cropped up continually—of bricklayers in Duluth, of ironworkers in Kansas City, of all trades in Des Moines, of various trades in such assorted communities as New York City, Baltimore, Denver, Los Angeles, Altoona, Pa., Ann Arbor, Mich., Charleston, S. C., Tucson, Ariz. The shortage had by no means reached the boom stage, when contractors “pirate” building mechanics on their way to work, enticing them away from other contractors with extra-fancy bonuses. But the bonus wage in 1937 is no longer a half-forgotten legend.

Eyeing these portents of an approaching building labor shortage the ARCHITECTURAL FORUM rounded up the evidence for its March issue. It found that “no individual or organization in the building industry has an accurate picture of the nation’s statistics on building mechanics and their numerical Depression decrease. . . .But gradually all the signs have begun to point to the possibility of a shortage.” Cited by the ARCHITECTURAL FORUM were the gloomy estimates compiled by Executive Secretary E. M. Craig of the National Association of Building Trades Employers that by the end of this year there would be 1,100,000 building jobs available with only 900,000 men to fill them.

Eight years ago the building trades had 1,600,000 skilled mechanics. Almost no one has entered the trades since, apprenticeship training having come close to a complete halt. Death, disability and departure for other occupations has meanwhile taken a 5% toll annually. Carpenters have turned farmers, plumbers have taken jobs with air-conditioning concerns, painters, plasterers and masons have gone to WPA. The favorite field for onetime builders is gasoline filling stations.

Many a reported labor shortage can be traced to local factors such as a big job in a small town or refusal to work for an unpopular contractor. The tightly organized labor unions vociferously deny a shortage, current or threatened, it being obviously to their immediate advantage to have contractors competing for labor. And the locals in the main are against indenturing apprentices. Wages for common labor in the building trades are already above 1929 levels, while skilled labor on the average is near the old highs. The rise has actually been greater than apparent because building mechanics in Depression often worked for considerably less than union scales. What the building industry fears is that labor costs will rise so sharply that the promised boom will be gravely retarded.