Workforce Development

October 1, 2008

The upheaval on Wall Street is delaying or stopping projects all over the country, even ones already under way.

September 30, 2008
Key financial, tax and spending legislation affecting construction remains hung up. Today the House rejected a financial rescue package, although the chamber is expected to reconvene on Wednesday. The House and Senate have been unable to agree on a bill to extend tax credits, due to expire at yearend, that have fueled construction of wind and solar power projects. Congress did pass a bill that would continue spending at current levels until March for discretionary spending, including highway and airport construction grants and direct federal spending on construction. President Bush is expected to sign the bill before spending authority expires at midnight Tuesday, September 30. In a conference call to states on September 22, the administrator of the Federal Highway Administration said the government projects that the highway account of the Highway Trust Fund will end fiscal 2009 (a year from tomorrow) with a balance of $1-2 billion, despite enactment this month of an $8 billion transfer from the general fund. 
September 22, 2008
The upheaval in credit markets has cut off the flow of funds to some developers, and a few contractors have stopped work on jobs, according to scattered reports. "In the short term, businesses in partnership with Lehman Brothers Holdings and American International Group, which had over $50 billion invested in commercial real estate around the country, had their deals threatened," the Associated Press reported on Thursday. "Lehman and AIG were investors in many large real-estate deals." On Wednesday, AP reported, "Already stalled in its plan for a $2 billion mega-casino in Atlantic City, Las Vegas-based Pinnacle Entertainment said Tuesday it was ending its bid to run a [$624 million casino resort and 500-room hotel in Wyandotte County Kansas], citing ‘the current turmoil in the financial markets.’" The turmoil may affect construction through two mechanisms. One is a resumption—or further tightening—of commercial loans to developers and of tax receipts to state and local governments. The second is a change in demand for different types of projects, such as offices and retail, as jobs and consumer spending either get back on track or drop further.
September 16, 2008
The producer price index (PPI) for finished goods tumbled 1.6% before seasonal adjustment (-0.9% seasonally adjusted) in August but rose 9.6% over the past 12 months, the Bureau of Labor Statistics reported on Friday. The PPI for inputs to construction industries, a weighted average of materials used in every type of construction plus items consumed by contractors, such as diesel fuel, was flat for the month and up 13% over 12 months. For the month, the indexes declined sharply for nonresidential segments but rose for residential construction, but nonresidential costs still rose more over 12 months. One- and 12-month changes were -1.3% and 22% for PPI for highway and street construction; -1.0% and 17% for other heavy construction; -0.4% and 12% for nonresidential buildings; 0.1% and 9.2% for new multi-unit residential; and 0.9% and 8.4% for new single-unit residential. The disparities are largely traceable to diesel fuel, which plummeted 20% for the month but was up 50% over 12 months; diesel is a major input for highway and other heavy construction. Building costs were pushed up for the month by a 4.7% jump in gypsum products, which had fallen for two years and are still up only 1.7% over 12 months. Other big movers: asphalt paving mixtures and blocks, 9.7% and 47%; steel mill products, 2.2% and 41%; copper and brass mill shapes, -2.1% and 3.5%. In a sign that general contractors are having to absorb price increases rather than pass them along, the PPIs for finished buildings, which include overhead and profit as well as materials costs, showed milder changes: 0.6% and 4.8% for new industrial building construction; -0.1% and 4.4% for new warehouses; 0% and 3.2% for new schools and -0.1% and 3.6% for new offices. Indexes that were introduced in July for prices charged by nonresidential building subcontractors showed these one-month changes: -0.3% for concrete contractors, -0.1% for electrical contractors, 0.1% for plumbing contractors and 1.0% for roofing contractors.
September 10, 2008
Seasonally adjusted construction employment fell by 8,000 in August and 437,000 (-5.7%) over the past 12 months, the Bureau of Labor Statistics (BLS) reported on Friday. The drop was the 14th in a row but the smallest in that span. Total nonfarm employment fell for the eighth straight month, by 84,000, and by 283,000 (-0.2%) since August 2007. Employment at residential builders and specialty trade contractors fell by a combined 19,000 for the month and 352,000 (10.9%) over 12 months. Employment at nonresidential builders, specialty trade contractors and heavy and civil engineering contractors rose 10,000 in August and dropped 85,000 (1.9%) over 12 months. But Census Bureau data and reports from contractors suggest BLS has understated residential job losses and that nonresidential employment has risen, not fallen. Census reported on September 2 that residential spending fell 27% from July 2007 to July 2008. There were even bigger drops in residential starts (-30%) and building permits (-32%), Census reported on August 19, making it likely that residential contractors reduced employment by at least 27%, not 10.9%. The difference, roughly 520,000 employees, probably comprises workers at firms that originally identified themselves as “residential” specialty trade contractors but are now doing nonresidential work. If that number is added to the BLS estimate of nonresidential employees, nonresidential employment actually rose 435,000 (10%) over the past year, a number consistent with Census’ report of a 14% rise in nonresidential spending and with contractors’ reports of greater competition today from subcontractors that formerly did residential work. Such an adjustment also helps explain why seasonally adjusted average hourly earnings rose more in construction over the past 12 months (5.0%, to $22.05 in August 2008) than among all private production and nonsupervisory workers (3.6%, to $18.14).
September 8, 2008

Each summer for the past half dozen, AGC of Maine has helped sponsor what one newspaper article called

September 8, 2008
This article originally appeared in the July/August edition of Constructor Magazine Even in an uncertain economy, one thing remains the same: Education helps construction professionals meet changing market demands. AGC’s ability to offer continuing education credits to meet licensing or designation requirements helps members get the most from professional development programs. In addition, the added convenience of local programs, webinars and audio conferences reduces travel costs and time away from the job. Whether the student is a project manager, specialty contractor, safety director, supervisor, estimator or other project leader, AGC’s increasing variety of courses help build a successful career.
September 8, 2008
AGC has begun offering regular webinars on a variety of topics that reflect the industry’s demand for the most up-to-date information. Webinars provide several benefits to participants. They are simple and convenient to participate in. They allow participants to access critical information in real time. And, perhaps the largest benefit is that attendees do not need to travel to participate in the seminar. What will you need to participate in an AGC webinar? All you need is a computer and Internet access.
September 8, 2008
Plan to participate in the next AGC Supervisory Training Program (STP) Train-the-Trainer in Albuquerque and learn to: Effectively teach adult learners,  Encourage interaction among participants,  Get the most out of the STP instructor materials,  Incorporate visual aids into the curriculum, and  Prepare for and conduct STP courses.  Contact education@agc.org to learn more. Registration to open soon!
September 8, 2008
The 2008 October Estimating Academy will be presented by AGC of America and the American Society of Professional Estimators, held on October 28-29, 2008 in Omaha, NE. The conference will be held at the Embassy Suites Omaha Downtown/Old Market. This two day course will cover current topics like LEED® - Estimating for Green Buildings, Estimating with Electronic Documents, Managing Preconstruction and Conceptual Estimating. This program is appropriate for Junior and Senior Estimators.

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