News + Views

Employers assign more overtime during labor shortage

Although Bureau of Labor Statistics data show average weekly overtime hours fell slightly from February to March 2018, employers—especially in the construction, mining and logging industries—are assigning workers extra hours to help handle labor shortages, according to www.constructiondive.com.

Employers in these industries have asked their workforces for overtime hours at higher year-over-year rates, with hours increasing as much as 50 percent at some companies. As a result, some workers regularly put in 50- to 60-hour workweeks. Asking workers to work overtime allows employers to maintain current benefits levels in a tight labor market, but the hours cut into profits and cause strain for workers and employers.

Automation is eliminating staffing increases and overtime costs for some companies, but new machinery and software can take up to six months to activate and require workers with tech skills to operate them, which can make automation a risky investment.

Employers could see a new overtime rule proposal under the Fair Labor Standards Act (FLSA) in October 2018. Previously, a federal judge invalidated the Obama administration's overtime rule, which would have made workers earning less than $47,476 per year eligible for overtime pay under the FLSA.

Various options exist for companies and industries facing problems finding workers. For example, employers could invest in apprenticeships and reskilling programs, and expanded talent pools and partnerships with local educational institutions could broaden the applicant base and highlight opportunities in these industries.

Nearly one quarter of construction workers are self-employed

According to the 2016 American Community Survey (ACS), more than 23 percent of construction workers are self-employed compared with about 10 percent of the total U.S. labor force, according to the National Association of Home Builders. The high self-employment rates in construction reportedly reflect a common practice of builders and remodelers to maintain relatively small payrolls and rely on subcontractors for a large share of the construction work.

During the housing downturn, construction self-employment increased from 24 percent in 2006 to more than 26 percent in 2010. Builders and remodelers who no longer were able to maintain a steady work flow likely may have tried to manage costs by eliminating payroll positions and becoming self-employed. It also is possible some construction employees laid off during the downturn managed to stay in the industry by starting their own businesses.

Hiring trends reversed as the housing industry began to improve. The construction industry has been adding payroll jobs since 2011, and the number of self-employed construction workers continued to fall until 2015, dropping to 23 percent in recent years.

The ACS data show that from 2011 to 2016, construction gained close to 1.2 million private payroll jobs—a 20 percent increase—but the pool of self-employed workers grew by about 100,000, or 5 percent. This could explain why builders have reported more extreme labor and subcontractor shortages than suggested by commonly cited numbers based only on payroll employment.

In some states, homebuilding accounts for a higher share of the labor force, and these states also register higher shares of self-employed workers. Maine, Montana and Vermont have the highest shares of self-employed construction workers in the U.S., with 40 percent in Maine, 37 percent in Montana and 35 percent in Vermont being self-employed.

Florida eases rule restricting rooftop solar sales

Florida is removing a roadblock to consumer solar leasing, an arrangement that drove a boom in U.S. rooftop power systems. The decision will allow Sunrun Inc., San Francisco, the largest U.S. residential-solar company, to expand in the state, according to Bloomberg BNA.

Utilities are the only entities that can legally sell electricity in Florida. Sunrun challenged an interpretation of that policy, and the Florida Public Service Commission ruled the company's 20-year solar-equipment leases don't constitute a retail sale of electricity.

"Sunrun will be able to lease rooftop solar equipment to homeowners without being considered a public utility," the commission said in a statement.

Leases let consumers get rooftop panels with little or no upfront costs. Previously, Florida homeowners had to pay for the systems themselves or finance them, which helped utilities like NextEra Energy Inc.'s Florida Power & Light Co., Juno Beach, fend off a wave of residential solar.

"The commission's vote to grant our petition is a critical step toward broadening access to solar energy for Floridian households," Anne Hoskins, chief policy officer for Sunrun, told Bloomberg BNA in an emailed statement.

Florida is a promising solar market. Although there are no state clean-energy targets, Florida ranks third in the U.S. in terms of potential rooftop solar and 12th in installations, according to the Solar Energy Industries Association.

"Florida was already going to be a growth market," Hugh Bromley, an analyst for Bloomberg New Energy Finance, said in an interview. "This could supercharge that."

Students not pursuing college celebrate joining the workforce

On March 28, public school officials in Henrico County, Va., celebrated graduating seniors who are heading straight to jobs and careers instead of college, armed with training and industry-based certifications they earned in high school. The first-ever "Career and Technical Letter of Intent Signing Day" was held to celebrate those students and their imminent employment.

"Henrico Schools' Career and Technical Education program decided athletes weren't the only ones who deserved to have their hard work recognized as they look to the future," the county explained in a post on its public Facebook page. "Students and representatives of their future employers both signed letters of intent outlining what students must do before and during employment, what the employer will provide in pay and training, and an estimate of the position's value."

Although signing days are a familiar ritual for high school athletes committing to college teams, doing the same for vocational students is a new concept, says Mac Beaton, director of Henrico County Public Schools' Certified and Technical Education program.

Henrico County recognized 12 students as they signed letters of intent to work as machinists or apprentices with local and national companies, including paving and construction firm Branscome Inc., Williamsburg, Va.; Howell's Heating & Air, Hanover County, Va.; the aeronautical division of Rolls-Royce, Westhampnett, U.K.; and Tolley Electric Corp., Hanover County.

"We're always trying to figure out how to address the skills gap when the general mentality of parents is 'I want my child to go to college,'" Beaton says. "One way to do this is to help them see the value of career and technical education. When you start talking data that affects parents' pocketbooks, that gets their attention."

More than 5,000 students earn industry-based certifications in Henrico County each year, and those certifications represent training that could lead to immediate employment for students upon their graduation.

Beaton had specific goals when he planned the signing day event.

"I wanted the students to see how the skills they had been learning at school apply to the workforce and how they were going to use them," he says. "I wanted to do the signing day early so the companies can invest in the students up front, and when they hit that workforce June 17, they are ready to roll."

Beaton himself could not afford college when he graduated from high school and felt lucky to join an apprenticeship program as an electrician before becoming a teacher.

"There are multiple pathways to achieve the same goal," he says. "We get so caught up in thinking that every child will go to college and get a job, but the ultimate goal of every parent is to have their child working, making a good wage and happy."

Suicide prevention alliance offers mental health screening

As part of its commitment to safety in the roofing industry, NRCA is a member of the Construction Industry Alliance for Suicide Prevention, a group of key industry organizations that have recognized and are committed to promoting the safety and well-being of construction workers. The Construction Industry Alliance for Suicide Prevention offers resources on its website, including published articles, frequently asked questions, posters, and information and tips regarding how to plan an education session or suicide prevention summit. Part of NRCA's membership commitment involves periodically sharing the association's suicide-prevention resources.

One resource intended to boost self-awareness is a free online mental health screening. The brief screening is intended to help an individual determine whether he or she, or someone he or she knows, may need to seek assistance from a mental health professional. The screening is confidential and anonymous. To begin, an individual is prompted to answer the question, "How have you been feeling lately?" Based on his or her response, an individual then is directed to a multiple-choice questionnaire. Results, recommendations and key resources immediately are made available upon completion of a questionnaire. An individual also can take the screening again if he or she had more than one answer to the initial question.

Industry professionals are encouraged to take advantage of the mental health screening and the Construction Industry Alliance for Suicide Prevention's other resources, which are in place to help ensure any individual who may need mental health assistance receives the support he or she needs. The mental health screening and additional resources are available at www.preventconstructionsuicide.com.