That is an all-too-common scenario in Vancouver where the robust construction economy has pressed contractors and left major projects months behind schedule. Concrete and rebar trades are among the scarcest these days but the hot-paced highrise construction scene has also resulted in a dearth of crane operators and even cranes. Other trades are also scampering to meet the demand. The economic pressures have led one industry observer to suggest the city’s building industry is facing the “perfect storm.”

For many sheet metal contractors—a trade that isn’t short of skilled crews—the delays have necessitated juggling crews from stalled jobs to active ones in attempt to keep all workers busy. Member contractors of the British Columbia Sheet Metal Association (SMACNA-BC) have done a good job: they haven’t had to lay off staff. Yet. But any contractor that gets greedy and takes on more work than it can handle, might be in for a tough time. “If you can believe it, this is the perfect environment for companies to go broke,” says Bruce Sychuk, executive director, of SMACNA-BC.

“SMACNA-BC encourages our contractors to learn from others mistakes. For example over a 10 year period in Western Washington there was so much work available some contractors rather than exclusively doing work for their “A & B” customers, those who got them through the lean years, decided to quote “C” customers with the end result being overextended and not being able to provide customary service to all of the customers.”

One of the reasons SMACNA contractors have done well and should continue to do so in precarious boom times, is the association has offered its members a number of management and supervisory training programs that help them hone business practices. “We are very rarely behind the gun,” says Sychuk.

Success comes also because the association has a solid relationship with the union —Sheet Metal Workers Local 280. SMACNA’s training board, its board of directors and the union meet monthly to address management and apprenticeship issues. Some observers say the bond between the three groups is a key reason there is no skilled labor shortage in BC’s sheet metal trade. “All of us were thinking three years ago that this boom was coming so we started recruiting for it,” says Mark Halvorsen, president of Surrey-based Viaduct Sheet Metal Ltd, a major sheet metal contractor and a member of SMACNA-BC.

The close bond didn’t happen overnight. “We knew the traditional view that the union always had to be opposed to what the employer wanted and vice versa had to go,” explains Jim Paquette, business manager of the Loc. 280. The contractors, association and union have embraced the idea that the industry would be most successful if they weren’t at each other’s throats.

Paquette says in the mid 1990s it was tough recruiting apprentices for the sheet metal trade because construction was at low ebb. With signs of the economy picking up in the late ’90s, Loc. 280 teamed up with SMACNA to aggressively promote the trade, often through trade fairs and other events targeting youth. “After eight years of it we are now reaping the rewards. We have doubled the number of apprentices we had years ago.”

In 2002 the training centre ran nine six-week technical training classes; in 2007 it will have 16 classes scheduled. “We have been averaging about 14 students per class over the last five years but the average per class is increasing and we are currently assigning up to 20 per class,” says Cindy Dimitrijevic, training co-ordinator, Sheet Metal Industry Training Board of the Sheet Metal Workers Training Centre Society. In operation for 13 years, the training centre is funded in part by member contractors (22 cents per hour) with the smaller remaining portion coming from the BC government.

SMACNA also just implemented a pre-apprenticeship program in an effort to attract more youth to the field. The idea is to allow anyone to join the union for free and “try the trade out” at the first-year apprenticeship rate of about $15 an hour. A monthly evaluation is done by the contractor, says Sychuk.
The association’s executive director says the experience shows that the best apprentices (and the ones that stay in the field) are workers with previous experience in construction. “They know going into the trade what to expect, whereas some of the students enrolled at BCIT (British Columbia Institute of Technology) for six months pre-apprenticeship training don’t know what to expect. Sometimes they get their ticket only because they have put in the time.” Often marginal workers, they are the first to quit or be laid off in lean times.

Statistics show that the attrition rate in most trades during apprenticeships is often well above 50 percent.

Most of the Lower Mainland’s sheet metal contractors have managed to keep all their workers busy, despite delays of up to eight months on some major projects. “We felt at this time for the amount of work we’ve taken on that we’d be short at least 50 men but that hasn’t materialized because so many projects are far behind schedule,” says Halvorsen.

For example, Viaduct Sheet Metal was scheduled to start work at the Vancouver Convention Centre over eight months ago but the big project has fallen behind because of construction complications and labour and material shortages. The delay has an upside: “We can place the 45 or so men we had for that job elsewhere,” he says.

The downside is that sheet metal prices may increase while Viaduct sits on the sidelines bound to its original contract price. That makes estimating jobs a tricky business. Four to six-month project delays must be factored into bid prices, the contractor points out.

A lot of contractors were caught by surprise three years ago when metal prices soared as a result of the pent-up demand in China. “Up to that point, we had a steady metal price for at least 15 years, and then it doubled. That killed companies for about two years. Now we have all downsized and in our bids we include what we perceive as a reasonable increase in metal prices which we hope will cover us.”

Halvorsen says in the 18 years he’s been in the sheet metal business, he has never seen the Vancouver construction economy so hectic. Viaduct employs about 100 sheet metal journeypersons on jobs in and around Greater Vancouver.

Many of the labor shortages are in non-union trades such as concrete, rebar and structural steel trades, which have done “a terrible job” training workers, he says. “We (SMACNA-BC member-contractors) knew this boom was coming so we built up our apprenticeship base to be ready for this work. We are 100 percent employed but we could put more apprentices to work if the other trades would get their part of the work done.”

But the shortage of skilled trades is a result of more than just poor trades training efforts. Paquette says the Lower Mainland is being battered by “the perfect storm: everything has come together to create a good economy.”

He says like all trades, the sheet metal industry must take care not to oversupply the market because when the economy slows, skilled workers will go unemployed. “We’re working very hard to try and keep everything balanced.”

Keith Sashaw, executive director of the Vancouver Regional Construction Association (VRCA), says while the sheet metal contractors association and some other trade groups have done a good job of recruiting tradespeople, overall the skilled construction labor pool in the Lower Mainland will remain shallow for a while. “Vancouver and BC are going through an absolutely unprecedented period of construction.”

The provincial government’s publication of major project inventories shows that in March 2005 there was $65 billion in construction activity in BC, based on projects over $20 million in the Lower Mainland and $15 million elsewhere in BC. In July ’06 that number skyrocketed to more than $100 billion. While residential activity is expected to see a modest decline, he doesn’t foresee any slowdown in ICI sectors.

Sashaw says the province’s construction boom is likely to continue through 2008 and possibly into 2009. While he doesn’t anticipate a major labor shortage crisis in the Lower Mainland, some marginal projects might have to be put on hold until the building economy cools.

The shortages are complicated by the fact that Alberta’s boom draws skilled workers away from BC and that the average age of skilled construction workers in the Lower Mainland is 42; in some trades it is as high as 48. “Those people will be retiring in a few years.”

While there’s no panacea for the shortage, the VRCA has been involved in a number of recruitment efforts. For example, the association and its national edition, the Canadian Construction Association, have been lobbying the federal government to broaden and streamline the temporary foreign worker program.

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Official Journal of Record for SMACNA-BC