Could labor shortage thwart billions of dollars in new Minnesota infrastructure work?

According to an August survey of nearly 300 construction companies in the nine states covered by the Federal Reserve Bank of Minneapolis, 76% said working conditions were “very difficult,” compared with 62% reported in a survey by may.

The difficulties in Minnesota and the Dakotas reflect national trends. In September, a US Chamber of Commerce report found that more than half of US construction companies were having “great difficulty” finding skilled workers. Businesses and economists widely agree that the skills shortage that existed before the pandemic has worsened.

“Before COVID, we saw a lot of tension between the skilled trades. It got worse, ”said Ron Wirtz, regional director of outreach for the Federal Reserve Bank of Minneapolis. “We are seeing companies reacting to this by increasing wages, trying to be a little more flexible in terms of hours.”

Yet while the workforce is tight, it’s unclear exactly what the situation will be once the trillion-dollar infrastructure spending bill begins to fuel projects across the country. The roughly $ 6.5 billion Minnesota can expect to receive will not immediately affect the bloodstream of the economy. The state legislature must first decide how to spend the money, and then projects go through a competitive bidding process.

Ron Wirtz contributed / www.minneapolisfed.org

Ron Wirtz contributed / www.minneapolisfed.org

Businesses, labor groups, the state Department of Transportation and Wirtz all warn that it is too early to say what labor supply issues could mean for the infrastructure projects of the Minnesota, but if existing conditions hold for years to come, it could spell a bottleneck – especially if supply chain issues persist.

“Businesses are very busy right now and that’s good. They’re also busy in part because projects aren’t going as quickly as they used to be due to supply chain issues, ”Wirtz said. “If we’re going to rack up more projects, more dollars available to do more projects, I think they’re unlikely to enter the pipeline… as quickly as they otherwise would.”

Wirtz said he could see supply chain problems eventually correcting themselves, but it’s hard to say what the future holds as the pandemic has turned the economic climate upside down.

Tom Dicklich, executive director of the Minnesota Building & Construction Trades Council, said that despite concerns about skill shortages, Minnesota often has workers waiting for projects.

Dicklich, whose group advocates for 16 union affiliates representing 70,000 Minnesota workers, including carpenters, electricians and heavy equipment operators, said one of the big concerns was that skilled trades would over-recruit and have too many jobs. workers.

“It’s not like all of these trades are experiencing shortages right now, there are people sitting on the bench, especially as the summer plans get closer,” he said. “What we don’t want to do is bring in a bunch of people … and they all come in and there’s no work.”

This will likely only be when the Minnesota Legislature meets in early 2022 and decides exactly which projects it will spend money on so the trades know exactly how they will approach recruiting people for apprenticeship programs in the world. Minnesota.

“I think we’ll know more after the first year and see how these jobs and how the projects spread out over time,” Dicklich said.

Northland Constructors, a heavy construction contractor based in Duluth, has made it a priority to retain its current workforce and is partnering with local worker groups to ensure a flow of new workers, says Annie Harala, manager. the development of the project.

Annie harala

Annie harala

With other projects planned soon, the company is offering on-site training to new workers in the industry. New workers can learn skills from more experienced workers who may be about to leave.

“There is a lot of finesse in being an operator,” Harala said of using heavy equipment such as excavators.

Regardless of potential barriers to work, Northland Constructors, which has just completed a project on Highway 61 in Arrowhead, and is part of Essentia Health’s large medical campus expansion project in Duluth, anticipates that more than 6, $ 5 billion for projects could mean for the state. About $ 4.5 billion is for road and bridge projects, an area in which Northland specializes.

“We are really excited about this bill which has been passed,” Harala said. “It’s a great way to boost our local economies. “

The Minneapolis Fed plans to present its next construction industry investigation report on December 3.

Follow Alex Derosier on Twitter @xanderosier or by email at [email protected]


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