Story from the Wall Street Journal
In recent years, men without college degrees, who found it difficult to get the factory jobs that sustained their counterparts in decades past, have turned to construction work to climb into the American middle class.
Now they are falling from it. Neal King, 41 years old, is one of them. He entered the Army after high school, held one hourly job after another and eventually moved his family to this booming Gulf Coast city from Alabama in 2006 upon hearing there was work in construction. Steady work on highways and condominium projects for about $10 an hour, plus frequent overtime, catapulted the family into a four-bedroom rental, a point of pride for Mr. King. “I never imagined I’d live in a home with a swimming pool,” he said. Mr. King is currently out of work and that dream home.
By the peak of the housing boom in 2006, construction surpassed manufacturing as the biggest employer of men with at most twelve years of schooling. About 19.5% worked in construction, compared with 19.2% in manufacturing, according to an analysis of Census Bureau data by the Economic Policy Institute, a left-leaning think tank. Before the deep recession of the 1980s, 12% worked in construction and 36% in manufacturing. Hourly wages for those with less than a high school degree grew faster than wages of those with college and advanced degrees this decade, according to EPI.
Men with no more than a high school education working in construction earned an average of $17.34 an hour in 2006, a 20% premium to their peers in, for example, the service sector, according to Lawrence Katz, a Harvard University economist. “The housing boom helped less-educated men in particular,” he said.
But that work evaporated with the housing bust, and then the commercial real estate collapse. And while the recession may be ending, construction is unlikely to return to pre-boom levels for many years, despite the jobs generated by the government’s stimulus efforts. That’s left this group of workers who lack post-high school education with few job prospects in a labor market that increasingly favors brains over brawn.
“The one sector that was their escape this decade — construction — has collapsed,” said Mr. Katz.
Construction, which currently employs about 5% of all workers outside agriculture, has accounted for about 18% of the nation’s job loss in the past year. Construction has given back the 1.1 million jobs it added during the boom, plus half a million more. The industry, which employed 7.7 million Americans at its peak, has seen total employment fall 20% since January 2007, according to the Labor Department.
Naples gives a sense of the fallout. Once a sleepy resort town, it was transformed in less than two decades by a flood of well-off retirees and vacationers, and by developers eager for a piece of their wealth. Growth reached a frenzy mid-decade amid an influx of migrants from other parts of the U.S. and Latin America. The city’s work force grew by one-third from 2003 to 2006. One of four jobs added was in construction, which by mid-2006 employed about 18% of Naples’s workers.
The ensuing bust wiped out Naples’s construction job growth — and then some. As of August, the Naples metropolitan area had roughly 11,600 workers in construction, according to Florida’s labor department, a 50% drop from the peak. The metro area’s unemployment rate stands at 12.6%, as of August, compared with 8.5% a year earlier.
Construction’s decline, here and elsewhere, has fallen hardest on the least-educated men and particularly Hispanics, who represent 14% of the overall labor force but held one in four construction jobs nationwide before the bust, according to the Pew Hispanic Center.
The bust has left families like the Kings devastated. Mr. King hasn’t found construction work in over two years. A couple stints — working on a hotel loading dock and then as a night stocker with Walmart Stores Inc. — proved short-lived, as Mr. King saw his hours cut and his take-home pay dwindle to less than what he could receive on unemployment. While Mr. King continues looking for construction work, the family has traded their home for a smaller one on a busy corner.
Mr. King spends his days driving around the city at dawn scanning for new construction sites that might need an extra hand, working the occasional odd job and searching job postings online at the local unemployment office. There are some management-level openings but they require better qualifications. “If I had more school or a degree, maybe I could get a position like that,” he said.
Despite their troubles, the Kings consider themselves relatively lucky. By renting rather than buying, they have avoided a mortgage they can no longer afford. And after Rita King, 43, lost her teaching job at a school for at-risk kids, she landed a position as a receptionist with a psychiatrist.
Many others waylaid by the industry’s collapse have less to fall back on. Duane Gregory, a wiry 46-year-old, once stopped by St. Matthew’s House — Naples’s only homeless shelter — to pick up day laborers to assist him on his roofing jobs. Now that the work has dried up, he said he is homeless, too.
He has managed to stay busy working odd jobs, including some remodeling work and other small tasks. But he said he has had to give up his marina-front apartment.
“My kids don’t know I’m here,” he said, sitting inside St. Matthew’s House after a day spent near Fort Myers installing ceiling tiles in an elementary school. But Mr. Gregory, who has an associate’s degree in architectural drafting, is determined to stay in Naples. “I made Naples my home,” he said in an August interview. “It’s like my ship, and I’m the captain going down with it.”
Earlier this month, Mr. Gregory was jailed for trespassing. He couldn’t be reached for comment. His assigned public defender, Rachel Doernberg, said she hasn’t yet spoken with Mr. Gregory, whose arraignment is scheduled for Friday, but he hasn’t posted his $2,500 bail.
One hurdle in the way of re-employing these workers: Many are Hispanic immigrants, often lacking the education, language skills, or, like construction worker Cesar Morales, the desire for re-employment in office jobs or service-sector work.
“When I finished high school, I didn’t have money for college,” said Mr. Morales, 19, who was born in Mexico City and moved to the U.S. a decade ago with his father and brothers. So instead, he began working in construction full-time, installing sheetrock for $90 a day. “I was making pretty good money,” said Mr. Morales. “I used it to buy a laptop, shoes, clothes, I sent money back to my family that’s still in Mexico.”
But Mr. Morales lost his sheetrock job in January. After a few months of unemployment, he has been able to find work through a local branch of staffing firm Labor Finders International laying pipes for $8 an hour. “It’s not as good as it was, but I’m a lucky guy to have a job,” he said.
It is a relief to be working in construction, he says.
“To get an office job, you have to go to school, and you need money to go to school,” he said. “I don’t even like office jobs. I like construction better.”