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"L.A. ready to enact tighter green building standards", (c) Margot Roosevelt, Los Angeles Times, February 16, 2008

CONSTRUCTION may be slowing in some parts of the country, but it is booming in New York City, creating a seemingly insatiable demand for people with expertise in construction management.

From project superintendents who oversee day-to-day operations to project managers who specialize in planning and oversight to executives who run the companies, demand is outstripping supply.

The reason is twofold: a wealth of projects, and employees who are retiring faster than they can be replaced. Vincent C. Spataro, who had been working his way up the construction management ladder in New York City for about 10 years, got a sense of his value this year when a recruiter called.

That phone call opened the door to his considering other opportunities, and three companies made offers that reflected the diverse approaches companies take to woo applicants.

One company made its case by offering a salary edging toward $200,000. Another offer was in the mid-$100,000’s but promised rapid advancement after the first six to eight months.

Ultimately, he went with another company, Shawmut Design and Construction, where as his first project he is managing the construction of a Chopard jewelry store at Madison Avenue and 63rd Street. Mr. Spataro said he had been swayed by its employee stock ownership program and the thorough screening he received during the interview process.

Even now, when he is entrenched in a new job, the calls keep coming. “Just today I got a call from a headhunter who had my number from six months ago,” he said a few weeks ago. “It’s amazing.”

High demand for construction managers and executives in New York City is expected to continue for at least the next five years, as current projects are built out.

This is in sharp contrast to the overall construction picture. Figures from the Labor Department showed a decline of 90,000 construction jobs nationally in the 12 months ended in August. But the losses were concentrated in residential construction, where almost 155,000 jobs were lost — a result of the downturn in home building. In the nonresidential sector, more than 65,000 were added.

The number of workers on projects in New York City is expected to reach 123,100 in 2007, which would break the record of 122,000 set in 2001, said Richard T. Anderson, president of the New York Building Congress, a trade group based in the city. A majority are skilled laborers, as opposed to managers and executives, he said. However, he said, “the word on the street in New York City is that project managers are scarcer than skilled work people.”

According to figures provided by the trade group, construction spending is expected to reach nearly $25.7 billion in New York City this year, up from $24.6 billion last year and $20.8 billion in 2005. The increase was driven by nonresidential construction, which nearly doubled in the last year while the residential market in New York City also remained strong, the group said.

“The thing that’s driving this high demand for executive talent is the sheer volume of work, which I don’t want to say is unprecedented, but in its breadth and depth is stronger than it’s been in a very long time,” Mr. Anderson said.

Jeffrey J. Zogg, executive director of the General Building Contractors of New York State, which represents 175 general contractors and construction managers, told of a recent meeting at which members gathered to discuss their top three concerns.

“It was people, people, people,” he said, adding that the group recently held a reception for local colleges specializing in construction to discuss their needs and examine ways of bringing more students into the field.

Traditionally, people in the trades have worked their way up the ranks into management jobs. But in recent decades, as projects have become increasingly sophisticated and costly, there has been a trend toward hiring professionals with engineering or construction management degrees.

Les Hiscoe, vice president at Shawmut Design and Construction, says a wide variety of talent is now required for jobs.

Anthony L. Cioffi, a professor and the chairman of the construction management and civil engineering department at City University of New York, said his department was receiving two to three requests a week to fill internships or entry-level construction management positions. “Employers are basically fighting over my students,” he said.

Major companies like Turner Construction are focused not only on drawing talent from colleges through internships and other work programs, but also on reaching into high schools with such programs. Turner is working on several large projects, including the new Yankee Stadium, Tower 2 at the World Trade Center site and the JetBlue Airways terminal at Kennedy Airport.

“The resources coming out of the colleges are depleted,” said Pat A. Di Filippo, executive vice president at Turner overseeing the New York region. “America just does not produce enough electrical engineers, civil engineers, designers, architects; there just aren’t enough coming out to replace the attrition.”

Many managers and executives who worked their way up the ranks are now retiring. The field must also confront growing competition from other job sectors like technology.

Mr. Di Filippo said that in addition to its recruiting efforts, the company was working to ensure that its current employees are satisfied with their jobs and advancement opportunities and that their salaries are competitive. “Many of our employees say they are getting calls,” he said. “We know it.”

David Cone-Gorham, New York regional director for Construction Recruiters, based in Boston, says the demand is fueling higher salaries and generous compensation packages. He said that at the executive level up to vice president, he was seeing salaries of at least $175,000, along with signing bonuses, car allowances up to $1,500 a month, paid expenses and deals that include a percentage of profits on projects.

SHAWMUT, which opened a New York office four years ago with two employees and now has 80, offers a variety of training both for entry-level college graduates who want to specialize in management and for employees who want to rise in the organization. It emphasizes a comfortable work environment with activities like the Fall Ball and Beer Fridays, when employees come in at 4 p.m. for a beer.

Mr. Hiscoe said Shawmut had greatly expanded its in-house recruiting, offering bonuses of several thousand dollars to employees who refer candidates who are later hired. “We’ve changed our recruiting,” he said. “Now we’re about 50-50 outside to inside referrals.”

The company also has group meetings once a month where employees discuss people who they think may be good additions to the company.

Companies like Turner say they also emphasize industry reputation and the scope of their projects when wooing employees. They stress their ability to maintain career paths in what is inevitably a cyclical marketplace.

Though some executives predict that the building boom in New York will last at least five more years, what happens after that is anyone’s guess.

“There are a lot of guys trying to move because they want that bump in salary,” Mr. Cone-Gorham said. “In reality, everyone knows this market ebbs and flows. There are companies who will overpay, but they may be newer on the block or less reputable.”

In a situation like that, he said, “you’ll be the last in and the first out at that salary when the market ebbs.”

 

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