MCAA Regional Report, Region F

Words: Al Slattery, Eddie Miller, Rob BarnesArkansas - Rob Barnes
Louisiana - Eddie Miller
Oklahoma - Al Slattery
Texas - Rob Barnes

Workforce Development

Arkansas

There are no active programs at this time.

Louisiana

There are no formal training programs, Union or non-Union, at this time. Immigration has also become a factor in finding qualified workers.

Oklahoma

Five masonry programs are still operating under the Career Tech guidance. The thing lacking in filling the programs is more industry involvement in recruiting and the promotion of all construction opportunities at the elementary and high school levels. The local union is operating their program with a handful of apprentices. Most masonry companies are now relying on in house training to be the common practice.

Texas

In 2015 a bricklayer certification program was instituted through the University of Texas in both the Dallas and Houston markets. This is in addition to the existing training program supported by the UMCA that is a 4 semester program. General Contractors are seeing the need and working together with subcontractors to develop industry standard practices for continuity across the market place in safety and general skill sets by respective trades not inclusive of the Masonry Trade. Unemployment had remained high for a substantial period and while demand is returning, it is still unknown how many skilled workers left the field of construction. There is a general sense of frustration for masonry contractors in Texas for the lack of qualified personnel with increased demand in the South and a slowly recovering marketplace in the North.

Economic Conditions/Forecasts

Arkansas

Conditions have improved over the past year, but still remain tight and the market will continue to be slow. At this time, the institutional sector is probably the only part of the market that we see much activity while they try to take advantage of a depressed economy and lower construction cost.

Louisiana

There is little or no private work at this time and the rebuilding along the Gulf Coast remains Federal Government driven and very difficult to deal with.

Oklahoma

Presently the work load in commercial and residential is being fueled by the energy sector with an ample amount of work for each type of contractor. The underlying problem goes back to the shortage of labor, both trained and untrained. The pipeline of work looks to be full for the next 24 months.

Texas

Economic Conditions continue to improve. Home prices are stable and single family has seen continued recovery in 2015; the high end single family remains strong, multifamily sees continued growth especially on the high end, commercial office building should see continued growth in 2016. Building remains strong in the institutional area of education which saw a modest increase, and healthcare should see a modest increase in new starts.

Single Family: Single family is expected to continue to grow at a better than average pace throughout 2015, the high end segment of the marketplace should continue to gain momentum ahead of the impending price escalations of material and eventually labor, 2015 is projected to continue to see significant improvement to existing homes.

Multifamily: 2015 saw a slight downturn in comparison to the previous year, 2016 is predicting building demand to increase with the continued modest growth through 2017.

Commercial Building: Commercial starts slightly slowed in 2015. Owners and developers are continuing to work in the area of renovation or remodel. This segment should see grown through 2016 and into 2017.

Institutional: Will see continued growth for the foreseeable future due to the continued increase in population. The public and private markets of higher education are beginning to level off and growth is slowing but remains stable. Local government should see a slight increase in demand over the coming years, but overall still very sluggish.

Healthcare: Healthcare, which saw a 20% decrease in 2014, bounced back in 2015 and projects positive growth for the next 2-3 years. With the baby boomers beginning to hit retirement age, the need for facilities continue to increase both in the public and private sectors.

Masonry Marketing Activities

Arkansas

None at this time.

Louisiana

None at this time.

Oklahoma

The marketing opportunities are not what they should be due to no organized effort by local contractors or suppliers. The ample supply of work opportunities leads to the feeling that we have “enough” and hence there is no urgency to organize. This lack of urgency coupled with the labor shortage leads to a short sightedness and seems to be the overall consensus.

Texas

The marketing for the State of Texas is done by the Texas Masonry Council which is dominated by the Material Suppliers. Their focus is and has been the work with school districts and all level of government agencies to develop masonry-friendly code requirements. TMC has had some success in that arena, but they have lost focus on helping the industry create better and more qualified contractors who can and will perform the work within the required Codes and Standards.

Competitors/Trends


Arkansas

Arkansas remains stable although outside competition has begun looking at some large specialized projects. Barriers to entry however are high due to licensing requirements, local competitor’s ability to be more limber, and the inability for outside labor to draw from local worker base. Cost of construction in Arkansas is very competitive. Outside competition is finding it difficult to compete; they have many costs including distance, differential construction methods, and confidence of the local general contractors. Contractors have to remain vigilant and perform well to prevent outside competition from opportunity.

Louisiana

The quality of the masonry construction has suffered from the influence of outside contractors who were not qualified to perform the work. They came into this market and used the federal system to get work and perform with unqualified workers and with little regard for proper construction standards because of the push by the Feds to rebuild the Gulf Coast area.

We know also have General Contractors who have decided to self-perform the masonry section of a project and in doing so have lowered the quality of the masonry work and created a more difficult marketplace for the legitimate masonry contractors.

Oklahoma

The competitors are mostly fragmented with both in and out of state companies working on rebuilding workforces and equipment from the effects of the recession. The trends the masonry business has undertaken have made a drastic change in the state. The trend seems to be capitalizing on new methods and technology to keep up with the ever increasing compressing of scheduling plus the influx of General Contractors from all parts of the country to the Oklahoma market.

Texas

Competition remains very high. Margins have seen a slight recovery; but owners and designers seem willing to change materials to prevent escalation which has contributed to a loss in market share in order to keep cost down. It would appear that some financial stabilization of the local competition is beginning to happen, and the amount of subcontractor failure is beginning to slow. The amount of competition still remains high and outside competitors are leaving the market with the realization that with the low cost volatility in the marketplace in combination with local general contractor's lack of willingness to gamble their own reputation on the ability of out of town competition to employ local personal and build projects on time, have proven ineffective. General contractors are still requiring more financial information on subcontractors to try and assess their risk at using weaker competitors. The lack of willingness of the federal government to address immigration is stripping the available manpower from companies who are trying to prepare to adhere to stricter regulation and oversight. This, in combination with contractors willing to misreport labor, is allowing those who cheat to win.

Safety Issues

Arkansas

No report at this time.

Louisiana

No report at this time.

Oklahoma

Safety is an area that has rapidly improved with the wide array of equipment and training available through local vendors and tools such as the MCAA.

Texas

The contractor base in Texas has a very high focus on Safety. Due to the overall size of the state Texas remains at the top of the Federal Governments watch list. OSHA continues to be more visible and more active in pursuing fines across many of the market segments.
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