Perhaps. Although I do think it’s interesting that we’re now saying things like “framers get hurt all the time” and not things like “framers get killed all the time”, which would have been much more common in ages past.
I think that’s maybe more due to the medical system though. Here, no one ties off and no scaffolding is used. I know someone personally who almost died not long ago. My father used to do commercial roofing and fell 30ft once as well.
Title should be changed to the actual title of the article instead of the inflammatory subtitle chosen. The article opens up with an example of Germany facing the same issue.
The article does state that it’s especially bad in America, far worse than in Germany:
> Construction holds the dubious honour of having the lowest productivity gains of any industry, according to McKinsey, a consultancy. In the past 20 years the global average for the value-added per hour has inched up by 1% a year, about one-quarter the rate of growth in manufacturing. Trends in rich countries are especially bad. Over the same period Germany and Japan, paragons of industrial efficiency, have seen nearly no growth in construction productivity. In France and Italy productivity has fallen by one-sixth. In America, astonishingly, it has plunged by half since the late 1960s.
Makes sense. Commercial construction is dominated by bean counters whose incentives and penalties discourage risk.
Public works usually require separate bidding for different aspects of projects, which means you have 2-5 different entities to coordinate around. Some states and entities are experimenting with design/build contracts, but there’s obvious opportunity for corruption there, so who knows how that will fare.
A real estate agent told me that the big problem is in the 50's and 60's you could do massive developments in the suburbs. Imagine building the same house 500 times. You probably get very skilled and efficient at it. Today most developments are limited to just a few houses and a lot of construction is one off for permits and design so there are no economies of scale.
Just anecdotal, but made sense to me why costs are going up and productivity declining.
On the other hand customers don't really like their house looking exactly like the rest of the 'hood. HOAs are bad enough, but even the basic structure of all the houses looking identical? That's an eyesore.
I live in a neighborhood where there are about 5 different models of (fairly similar) house copied about 50 times each. I’m pretty sure this is still quite common.
Newsflash: it’s the building trades unions. We have the tech to build nice buildings much more efficiently but we don’t use it due to political advocacy from the trades unions. We have extremely inefficient regulations around building codes, largely due to lobbying from the trades unions. In CA right now, the trades are lobbying for regulations to ban cross laminated timber structures, which are a step function cost reduction change for 5-12 story buildings. The reason modular construction hasn’t taken off is largely due to political lobbying from the trades unions. They even lobby against zoning code changes that would allow people to build larger buildings with the same tech we currently have. It’s absolutely insane.
I don’t have an academic study, put I do policy advocacy in this space as a hobby, specifically around supportive housing for the homeless and this is my experience in California and the general understanding of the state of things by the politicians and professionals in the space.
It’s not conjecture that the trades lobby against well understood policy changes (modlular housing, cross laminated timber construction) that increase productivity, it’s just not something written about in newspapers or academic studies because it is extremely niche and there is basically no audience for the content. There’s maybe 250 people in the state of California that understand the state of things here; they’re lobbyists for developers, lobbyists for trades unions, lobbyists for affordable housing non profits, and a few legislative aides for people on the relevant committees. They mostly know each other and don’t need a newspaper to report on the goings on.
Instead, volatility in demand for construction has trained builders to curb investment. “The industry has learned through bitter experience to prepare for the next recession,” says Luc Luyten of Bain & Company, a consultancy. Capital-heavy approaches to construction bring high fixed costs that are difficult to cut in downturns. Workers, in contrast, can be fired.
One of the factors of construction is "it costs what it costs". Builders are willing and able to pass costs on to consumers and so don't have an incentive for cost savings.
This doesn’t explain everything though. We have a lot of consumers who want to build modular housing in CA and they are blocked by the trades. The trades lobby against both the construction of modular housing factories and specific proposed modular buildings. They don’t want more efficiency, they want more man-hours per project.
It's pretty ridiculous that you've the whole thread whining about "the trades". A variety of vested interests keep building costs high, with trade unions well down the list. Developers, large, monopoly builders and homeowners' association each as a group have more money than any unions and through a system that bring huge profits by high priced building and land appreciation, they have a vested interest in the high cost of building. Consider that when it's time sell schemes that raise the cost of building, the best "face" can trade union "protecting livelihoods" but that doesn't that's where the real power or money lies.
On a practical note - mobile home parks in my area are blocked by county and city government they serve home-values, out here in the sticks, unions really don't have but we've had no new parks for twenty or thirty years. But oppositely, it's easy to put mobile unit on the high price land you occupy yourself. Yeah, it's land value.
I'm not talking about making construction costs high, I am talking about lobbying against known technologies/techniques/code changes that can improve the efficiency of construction, it is a subtle distinction. Yes, there are many more players than "the trades" in california that have a vested interest in keeping construction costs high. None of those other interests shows up to lobby against modular housing or cross laminated timber regulations.
It’s extremely tough in California. The building trades are one of the most influential interest groups in crafting policy in the state legislature. The leader of the CA trades union who has lead policy lobbying for the past ~10 years recently retired ( https://www.sacbee.com/news/politics-government/capitol-aler...) and hopes are that this will help break a log jam of policy changes here.
30 years of state run schools and colleges telling everyone you absolutely need a college degree and everyone who works in the trades is a loser has resulted in a massive skilled tradesman deficit.
I think this is very common in many "western world" countries, not just the US.
And at the moment the software field seems a lot more financially rewarding to smart, practical young people trying to figure out what field they should go into.
> I think this is very common in many "western world" countries, not just the US.
I'd say it's the same process even in China these days.
There was a big stir online few years ago where it came to light that Shenzhen polytech grads have significantly larger salaries, and employment than much more prestigious university graduates.
On other side, I see more, and more Chinese companies becoming carbon copies of American corporates with engineering offices stuffed full of MBA's, and needing 10 SWOT analyses to fix a single line of code bug.
Being poor absolutely fucks up being able to live, so I'd rather have a meaningful career if I had the choice versus being look at unfavorably compared to an automaton in other fields.
I hadn't considered this before reading your comments, but it makes sense that skilled trades will be somewhat automation proof, at least in the medium term.
In part because skilled trades already are fairly mechanized. Backhoes, skid-loaders, nail guns, power tools, etc.
(And in general, I think mechanization is under-appreciated as a productivity enhancer compared to automation... Who is more productive moving something like gravel around, someone driving a 5 ton capacity dump truck or someone overseeing 100 gravel-moving drones with a capacity of 5 kilograms each? Even if the drones are essentially autonomous, the dump truck driver will be more productive in moving the material around because he's driving a big machine and the drones will need someone to manage them especially when there are problems. Or even compare 5 ton autonomous mining trucks with a 500 ton dump truck... the 500 tonner is gonna win. Larger scale machines are still a pretty straightforward way to improve productivity.)
Well there’s an argument that there’s not a lot gained by going fully autonomous for huge machines. These huge trucks are like $5 million apiece not including sensors and hardware and software for automation, and so hiring a human to operate them (or even just babysit them) for $20-30/hour (typical dump or coal truck operator wage) seems like a pretty obvious idea. Which doesn’t mean people aren’t automating mining trucks… they are! But there aren’t huge cost savings in terms of labor.
I guess I’m just saying that scaling up your smaller machine to be larger has the same kind of productivity enhancements as switching your smaller machine to autonomous. It is also something humans have been doing ever since the development of domestic beasts of burden.
Modular houses - where the fittings are made in the factory itself - is one kind of automation.
I met a guy a few years ago who had a plumber role in one of those modular factories... he said he was paid lesser but he likened it to a 9-5 job in a factory, and was ok with the pay.
But not recession proof. Also, the "automation" can happen gradually without making it look like it's affecting the trades. Thinking about plumbing, in my locale they've gone from sweated copper and iron drain piping, to plastic tubing that comes on a roll and is joined with some sort of tool that squeezes the fittings onto the tubing. Drain work is all PVC glued together.
So the skilled labor content of plumbing a house has decreased over the years.
Every house in my neighborhood has hardwood floors throughout -- it was cheap when the subdivision was built out, but laborious to install. Today, the same class of house would have carpeting or sheet flooring, costing a lot less to install.
Other things like vinyl siding, Romex instead of hard conduit, etc.
Is there a building industry equivalent of build the machine that builds the houses?
You can be a massively skilled electronic engineer, but you don't need to hand solder every board to have a great, skilled, outcome. I guess the answer is all the machinery we employ for larger buildings, but there's no real equivalent for the individual suburban home which still involves most of the manual labor.
Well, I’m about fifteen years older than you are. You must have worked with a different class of EEs. The one I knew weren’t hams and probably didn’t grow up building kits and stuff like we did.
Inductive coupling is one of the most fascinating topics in EM. And, is all the power really flowing in the air between the wires? The electricians don’t know that, either.
Well there's the tools industry and robotics in general but the issue ultimately comes down to cost and speed. You can use heavy automation and tooling to reduce the tax on a person but that equipment is incredibly expensive and often times is slower than a person or a few people just doing the job by themselves or with more "manual" tools.
Good small time subcontractors show up to the job themselves but train others to do most of the work.
Subs I worked with had pretty healthy markup over what they were paying their workers (>100% when invoicing hours).
The catch is they all had spent years learning the trade, and that part is definitely dangerous. I saw a guy ruin his back being over eager pouring concrete.
> I guess the answer is all the machinery we employ for larger buildings, but there's no real equivalent for the individual suburban home which still involves most of the manual labor.
Suburban housing is very easy to build. Building 1 storey houses is not a challenge anywhere in the world, and it is possible to build it super cheap even without any capital equipment.
Steel housing is a prime example that even a double digit percentage cost advantage, with it being a very straightforward, and overwhelmingly superior, replacement for wooden framing, doesn't seem to been enough to drive new technology adoption in USA.
I had an interesting experience, I did electronic engineering but i completely misunderstood how to solder - i was trying to melt the solder onto the iron and drop a drop of molten solder on the board with the wire. The technicians were laughing their asses off and said "if you cant solder maybe you shouldn't be here"
It was in 2nd year when I watched a youtube video when some guy actually explained thay you need to heat up the pad on the board, then add solder. I was totally flabbergased.
Soldering was a very minor part of my degree, so it didn't really matter, but still.
It helps to put a small amount of solder on the tip of the iron before you touch the pad - it improves the heat transfer. The main amount is added into the part/pad interface, as you saw on YouTube.
I’m thinking that, when you first learned to solder, you remembered the first step but not the second one, and thus got off on the wrong foot.
Well, houses are literally built by cnc increasingly often. There's a whole industry in the Baltics of building houses in a factory and shipping them around Europe.
There’s one channel on yt that I watch a lot. The fellow builds houses, and his ability to reach down and do useful work four inches below his toes amazes me.
This. My dad is a contractor. I’ve been taking some time off SWE work to try to learn some of what he knows while he can still do it. It is just hard on my body, half the days I wake up with the wrong kind of pain. Hanging drywall, digging post holes, sanding, painting, laying tile, etc. So much of the work is an ergonomic nightmare.
I think it’s not as bad in single family construction as commercial work, since the activity varies more over the day/week. But still, I can’t imagine my body not breaking if I did this for a career.
OTOH electrical work seems mostly reasonable. If one of my kids wanted to get into a trade that’s where I’d steer them.
Not diminishing the degree to which it can hurt your body long term - it absolutely can. That being said, most people that do that kind of work as a career start it as a job when they're 16-18 years old, and are typically active (sports, etc.) for many many years before that.
You're starting it at best in your mid-to-late twenties? And even if you played sports in HS and go to the gym regularly, your body just isn't used to it and it's past the point where it can quickly adapt and more importantly get used to the stimulus. You're likely much more prone to injury than someone fifteen years older than you whose been doing that work since they were 17 (I'm sure I am too, it would destroy and I am very active for a SWE).
Yes and no. I don't know of any exercise that would compare to sanding a wall, for example. It's not exactly an activity you would want to be doing for a long stretch of time.
No matter how fit you are, construction work isn't like you're getting paid to go to the gym.
Fair. I’m late 30s, my dad is 74 and can work circles around me. He definitely started manual labor young. I did some of it in high school but have been behind a desk since college.
I do consider myself very fit/active, but it’s not the strength or stamina that’s the limiting factor, it’s the holding weight at weird angles, or applying torque, or just reaching out over my center of mass for hours.
Anecdotally it seems like the specialists have it worst. His friends who did flooring all have wrecked knees, and the drywall hangers have messed up shoulders. He seems to have made it out unscathed, though other generalists he knows have back problems.
I think even in single family construction, it is often the case that people specialize and the work can be quite repetitive. We had some drywall work done, notably finishing a portion of our basement. Hanging the drywall, followed by taping and mudding, followed by painting. All were done by different people, probably with different pay scales and expectations of working conditions.
I've had people come to my house to do handyman work, and at the same age as me, they are hobbling and broken.
I suspect that one of the causes of the opioid crisis is that we had a pain crisis, caused by bad working conditions. I could imagine advising one of my kids to go into the trades, but only if they move to a country with decent labor laws, safety net, and health care. Not in the US.
Now we have electricians charging as much as software agencies.
HVAC installation costs as much as a car in warmer regions.
General handyman work outclasses all retail jobs, but you don't hear about people with two bachelors doing that type of work like you do at a Starbucks.
I think part of this is because skilled trades are often more physically taxing than "traditional" college degree desk jobs.
I'm inclined towards the skilled trade side of things because I like getting my hands dirty but I understand why people wouldn't want to do a job that has you in a shop or working out in the heat, cold, or rain on a regular basis. Not to mention I imagine the injury and/or casualty rate is much higher for many trades compared to desk jobs.
TLDR: We obviously need both and they are equally good fields but I completely understand the perceived higher valuation for the safer, less physically taxing albeit often more boring and sedimentary jobs.
I think society does a poor job communicating the actual lack of safety that comes from sedentary, physically repetitive jobs.
I wouldn't qualify for workers compensation for my herniated disc because I don't know when it started or why. But it's probably from sitting in front of a computer. Asking coworkers over 35, they almost all have injuries from computer work.
Maintaining weight and strength while a huge chunk of your day is sedentary is a big chore too.
General handyman work is not trivial. It's physical and requires a lot of tacit knowledge and perseverance. A regular 9-5 Starbucks job is, by comparison, pretty easy-in, easy-out (which doesn't mean we shouldn't pay people a reasonable minimum wage even for Starbucks... at very least $12.50/hour or something like it was in the late 1960s, if not $15 or $21/hour like it would be if we adjusted for overall productivity growth).
Livable wage discussions are often also about inequality and the broad sharing of societal-level progress. I think one reason Americans have become less optimistic about technology and progress is the benefits have not been shared as widely. Fixing minimum wage to productivity increases would help renew the social contract of people allowing (sometimes disruptive) innovation and progress.
But sure. Let’s tie federal minimum wage to inflation and then do local cost-of-living adjustments, say make minimum wage equal to, say, three times the typical rent for a two bedroom apartment in the area. That way places that might really struggle with $21/hour minimum wage (like Wichita, Kansas) but have low housing cost would be able to maintain adequate employment levels and attract business investment. (It would also force NIMBY-heavy communities like San Jose, California actually have to pay a consequence for extreme housing costs in the form of higher wage costs for local low-skill services… Encouraging more housing to be built.)
I think a big part of it is social status and marriageability. There is a social stigma against the trades that relegates its workers to low social status. PhD’s in history might struggle to feed themselves on their meagre lecturer salaries but they can insist that you address them as Dr.
A plumber might make a lot more money but they’ll never be able to shake the association with dirty, unpleasant work, despite the fact that a great deal of plumbers work in new installations for construction rather than household repair.
When I think of young and old PhDs alike, I don't think of high status individuals. I think of people who spent too long in academia. Most of them don't contribute breakthrough insights to their field in their lifetime, but rather make indentations to broader collective knowledge. That's not high status to me.
I think more highly of someone who owns their own plumbing business. An employer has more status to me because they command labor. A PhD graduate will most of the time be contributing deep narrow insight to a larger organization, not using their studies for entrepreneurial pursuits.
"I think a big part of it is social status and marriageability. There is a social stigma against the trades that relegates its workers to low social status."
This is fast changing. The days of "ooh they work in an office" vs. your average handyman are mostly gone US metro areas. If anything, electricians, mechanics, carpenters, firefighters, etc. are seen as "manly men" with the surviving traditional masculinity compared to most men in metro areas.
Yes, but that's not my point, they're of the same labor class to me. They're also literally the same labor category in Census documents or documents released by the DOJ.
They might be speculating, but it’s pretty reasonable. There’s been a massive uptick in college attendance and presumably a lot of those attendees would have been headed for the trades in the 60s before the “[almost] everyone should go to college” push.
Construction is an incredibly unstable source of income, its very feast or famine in nature. Software for example hasn't been since the dot com bubble burst
I think a good way to stabilize this industry, and overall help our current housing crunch and homelessness crisis, is to have a government builder. Somebody that builds countercyclically, buying land and collecting the same land rents that landlords do, but turning those land rents into more housing. We currently subsidize our food system with a massive amount of socialism, to the degree that Midwestern farming probably wouldn't be recognizable without the farm bill. However, our housing system is going to crap due to the instability of construction as a trade, which in turn is causing massive increases in housing prices. I think this is a place where we need to change our government policy to make it a better market. Instead of intervening only with massive subsidies for home loans as we currently do, we should also stabilize the demand side of construction to keep it healthy, by providing a continuous buyer of construction labor.
And yet college degree attainment hovers around 33% and those who do get one earn an average of $1m more over their life time than those who don’t. There’s something else going on here.
The just-so story I heard about the construction trades was that there was essentially no work for years after 2008. The master craftsmen retired or moved on, and as demand recovered there was hardly anyone left to train even those apprentices brave enough to enter an industry that just... sometimes doesn't have any work for a few years.
There aren't a lack of tradesmen, there is a lack of people willing to cut 20 years off their life for a marginal raise, especially in the US where that will barely cover their increased medical and tool costs. There is a lack of people willing to put themselves financially reliant on a boom-bust industry where workers are regularly fired or layed off on a moments notice.
I know more tradesmen that are leaving the trades than joining, and they are usually the best among their group. Being a skilled framer often nets you nothing over being a barely competent framer. Despite all these claims of trades making huge money, most tradesmen are not. For ever plumber in NYC making $50 an hour, there is a dozen other contractors working for $12 an hour using their own tools and trucks fighting over the scraps of lower class business who can barely afford them.
Which is why Germany had the "Meisterzwang" for a long time in the trades - basically only certified masters of a trade could open up a shop. Unfortunately, EU laws forced Germany to drop that requirement for everything sans a couple of high-risk trade jobs (e.g. electricity, plumbing, meatpacking, roofing and hairdressers).
The article says that companies are avoiding capital-intensive building techniques to avoid getting burned in a recession. Labor costs are faster to reduce.
And since Dodd Frank, financing is much harder to come by. Most residential contractors who used to be able to build the same spec houses a few dozen times each, are now in a position where they largely survive off of client financing, which means even spec house plans become client dictated custom homes.
It's much easier to build a dozen of something when you don't have to deal with 12 different clients/owners.
Unlike health care, where our understanding of human biology is fundamentally limited, I can't see a fundamental limit to automation in construction. The article notes that construction has become less capital intensive over the years due the uncertainty of construction demand (kind of like expensive defense items like planes being built almost by hand because orders are whittled down to a few per year).
And sure, the "cost disease" effect makes labor intensive industries seem less productive with apparently too-high-paid people.
The article makes a few assumptions I disagree with - one of which is that the projects they list being over-time and over-budget are because of builder productivity rather than the primary contractors over-promising to win a large contract.
In addition, value added per hour can be a sign of productivity loss, but is also impacted by shrinking margins (which they note is the case - but shrinking margins has nothing to do with productivity and everything to do with competition).
Also the article says "Many building professionals use hand-drawn plans riddled with errors" - Hand-drawn plans? This isn't my experience in the UK (I design warehouses and have worked with lots of primary contractors). CAD here is pervasive, and anyone with a hand drawn plan would be laughed out of the room (unless you were literally a builder doing a quick sketch - in which case CAD isn't a replacement).
And the article then recommends... self driving bulldozers as one part of the solution? This is so far away from being safe on a worksite that it's nowhere near an immediate concern.
> The article makes a few assumptions I disagree with - one of which is that the projects they list being over-time and over-budget are because of builder productivity rather than the primary contractors over-promising to win a large contract.
I’m guessing this explains most of it.
It’s common in the construction industry to compete during the bidding phase by underestimating the time and cost of the project, then making up for it with change orders later. It’s so pervasive in some domains that contractors feel they have no choice but to play the game to get contracts.
The smart buyers employ people who know how to manage contractors and construction companies with contracts that make time and budget overages less profitable for the company. The catch is that you need someone on your side watching the work so they don’t try to cut corners to get the job done. It’s difficult.
At smaller scales, it’s common for contractors to bid more projects than they can handle and then rotate between them, tending to the clients who complain the most. They’d rather overbook their calendar than have gaps in between projects.
Construction and contracting are not fun industries to deal with. Having known reputable contractors is very valuable, but the good ones are often booked out a year in advance.
And I agree about the other oddities in this article. I don’t even know if hand drawn building plans would be allowed in modern towns. Usually a licensed engineer is required to draw and approve the plans and there aren’t many licensed engineers still doing this who don’t use CAD.
> It’s common in the construction industry to compete during the bidding phase by underestimating the time and cost of the project, then making up for it with change orders later.
This is called change order abuse. Sometimes the contractor actually has an inside person receiving kick-backs or bribes where they can purposefully underbid while knowing in advance that they will be able to make it up with change orders (which will be approved by the inside person)
This is where (AFAICT), contracts are standardized templates, and it is only 'amendments' that are custom for the project: blueprints, bill of materials, timetables (for staging payments), etc, are custom on each job. This (supposedly) allows for fewer lawyers to be involved, and only the 'technical' stuff needs to be looked at.
I think the distinction is not hand-drawn with eg a pencil and ruler, but drawn-by-a-hand via CAD software.
There's plenty of beautiful CAD plans that don't hold up in the real world (this is why as-builts exist). I feel like there could be a scripted tool to check things like code compliance and stop people routing conduits through beams etc.
My experience with "hand drawn plans" doing IT for new retail locations in the US has been interesting. It's not my specialty, but we've had a few clients open 40+ new locations country wide between them with varying budgets, timelines, industries, and GC's.
I need to interface with the electricians, carpenters, HVAC, and the GC on every project. None of them have the same drawings and none of their versions are the latest from the architects and engineers. The architects or engineers are also very expensive, so they rarely get brought back in for updates to drawings once unless it has to do with code / regulatory approvals. This ends up with the client's latest real drawings being
a jpeg screenshot of the original plans that they just email blasted to everyone.
All the vendors and boots on the ground definitely have a version of the CAD floorplans, but it was whatever they decided to print out 3 weeks ago when they got this job on their calendar. The workers have just been marking it up by hand since then. This is where a lot for the confusion, delays, and change orders come from. I don't know if this is just what to expect with budgets less than a few million, or maybe it's just retail style projects, or maybe my clients attract poor quality vendors (I guess that says more about me). The only time with no major problem was when one client stuck to one GC over the course of 20 new buildouts. They eventually figured out how to wrangle all their subs together.
> This ends up with the client's latest real drawings being a jpeg screenshot of the original plans that they just email blasted to everyone.
Just ask the client to go ask for the DWG, 9 times out of 10 you will get it. Might be different in the USA but that’s my experience in the uk. If there is only paper, we have a CAD guy who can quickly transfer it into CAD in about an hour (there is software specifically for this).
I think it’s just endemic to the industry. Even on high budget work with full time project managers we’ll find the subs on site working from an ancient drawing superceded months ago, or a sketch made on a wall by people discussing an issue. A good foreman is worth their weight in gold.
Anecdotal, but when our local government does a project, they only look at the price tag. If they can afford it, it gets approved.
Building something is very labor intensive (the way we do it here in the US; the article talks about China and other ways of building) and the actual proposed budgets should be higher and timelines longer based on how we build.
But in order to win a contract, the builder must lie and say "we can do it for this much and in this time frame," which tends to be lower than what we can actually realize.
Oh, I think I can explain this pretty easily... most construction companies aren't competitive. Construction and real-estate are two markets that are from top-to-bottom, inside-out, soaked in cronyism. I'd wager most multi-million dollar plus construction companies simply know the right people to get the contracts and as a result never effectively "bid" on a single fucking thing. Why then, if there is no real competition, would you ever increase productivity? Short answer, you wouldn't. Being more productive would require increasing the rate at which you use capital (i.e. you spend more) witout any accompanying increase in gross profits. shrug
In most parts of the USA winning on a public project requires three bids.
Why do the same companies always seem to win?
In my neck of the woods (The Bay Area), one company seems to get all the jobs. The company's name rhymes with Gelato.
I started to look carefully at the bids.
(I got a General Contractor's license a while ago, and it an easy test, and verification of work experience is a joke.)
Ok, I looked into the owner of the contractor's license, and in all three bids, they had a "Gelato" as owner of the company.
It looks like the "Gelato" family sent three kids to Sacramento to take the test, and get their licenses.
They all bid on the same project, and one wins.
They must share the million dollar equipment, and pool of employees though?
Is it legal? I don't know.
Do I know for a fact this is how it works--no.
(There's a bill, I believe up for vote soon, in Sacramento. It requires all bidding parties to verify their company us big enough to do the project. I don't think we need a bill like this. I don't think small companies bidding on huge project to is a problem. If I am right about "Gelato" construction company--authorities should look into the bidding process. There us a reason, besides inflation, that public projects get more expensive each year, and never seem to end.)
I dunno what the op intent was except just a general sense of discretion that is kind of the HN vibe. But it's obviously Ghilotti Construction. And yes, they do seem to build everything around here, freeways, bridges, big stuff like that. They don't have a wikipedia page, my uncle was a civil engineer there for decades (now retired)
Kind of reminds me of the SWIM nonsense of the early internet. Not saying the name with so much detail isn't protecting you from anything. Just say the name people, or don't comment.
If they do a good job at prices that are in the ballpark it may be fine.
Sometimes what looks like cronyism is just someone picking someone they trust to do the job. It can be hard to tell the difference unless there are obvious problems constantly being overlooked - like with NASA contractors for example.
This is absolutely compatible with everything described in the article. A lower-productivity project is a large project, a larger project allows larger amounts of money to be skimmed.
Plus elaborate custom specifications for projects also make it hard to keep track of costs and bureaucrats wind-up fond of these things. Etc.
It's not just cronyism, it's flat out corruption. I took a 2-3 year detour from tech to work in construction.
The industry is rife with corruption and misaligned incentives. Kick-backs are common. Bids are often not truly competitive, and when they are, people find ways like change-order abuse [1] to subvert the system. There are so many ways to rig the bidding process (bribing someone to find out competitor bids so you can undercut them) and the execution (cutting corners that you don't expect someone to find out about, or just bribing whoever is overseeing quality who might detect the corners you cut).
Even the US Army Corps of Engineers has had massive corruption cases. When I was in the industry this was an open secret, which surprising to me given the Foreign Corrupt Practices Act... eventually this would be cracked down upon [2], but as far as I've heard, still common.
It was a family business and I helped out by the managing operations (this was more as a supplier of building material to contractors) and doing business development (which involved bidding for construction projects).
I once rented a room from a guy whose job was to lead a “follow” crew behind crews that were building houses. I job was to fix mistakes that the building crew had made during the initial build.
I’m glad he had a job, but it stems like the builder could have saved a lot of money by just moving a little slower, and doing it right the first time. Then again, maybe the cheaper labor building the houses offset the extra cost.
Problem I get into: spending so much time thinking about the right/most efficient/best way to do something that I don't get anything done. I'd be more productive of I could just work at one thing continuously and let someone be an expert at fixing the trickiest cases. Also, houses settle. Cracks can show up after you are done regardless.
Down the Wikipedia rabbit hole and I see that Brandenburg Airport was finished in 2020.
In its preamble the Economist says: the project encountered a series of successive delays due to poor construction planning, execution, management, and corruption
That would be poor: planning, execution, and management. The corruption was of the best European standard. Quite excellent.
the blame pointed on having multiple/layers of sub-contractors can be avoided by the client inserting this clause in their contracts, or am I vastly simplifying this?
In IT, it happens often that there is a clause that prevents contractors from sub-contracting a position. This forces them to hire for that skill.
What is special about the construction industry that this cant be done?
We haven't seen big ideas in the construction industry yet. Where are the 3D printing processes and modular designs? Sure, they exist, but not on the scale needed to revolutionize this industry.
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[ 3.7 ms ] story [ 219 ms ] threadI was shocked to read this until I saw the date. 2017 should be added to the title.
Quick look at https://sbcmag.info/news/2015/jan/construction-jobsite-fatal... does seem to bear this out, though really need a longer time-scale for a bigger picture upon this.
I have an uncle who has lived for 40 years with mental disabilities and unable to drive, from an a construction site accident.
My grandfather died before reaching 60 after a series of ailments starting with a back injury suffered in the construction industry.
It is hard & dangerous work, which has gotten dramatically safer over time. It nonetheless remains hard on the body.
Actual article title:
Efficiency eludes the construction industry
> Construction holds the dubious honour of having the lowest productivity gains of any industry, according to McKinsey, a consultancy. In the past 20 years the global average for the value-added per hour has inched up by 1% a year, about one-quarter the rate of growth in manufacturing. Trends in rich countries are especially bad. Over the same period Germany and Japan, paragons of industrial efficiency, have seen nearly no growth in construction productivity. In France and Italy productivity has fallen by one-sixth. In America, astonishingly, it has plunged by half since the late 1960s.
- While it was a subtitle, it was way more to the point
- Specifically pointing to America was also appropriate
The Economist is a magazine publication. Their headlines are a concession to the content.
Public works usually require separate bidding for different aspects of projects, which means you have 2-5 different entities to coordinate around. Some states and entities are experimenting with design/build contracts, but there’s obvious opportunity for corruption there, so who knows how that will fare.
Just anecdotal, but made sense to me why costs are going up and productivity declining.
Instead, volatility in demand for construction has trained builders to curb investment. “The industry has learned through bitter experience to prepare for the next recession,” says Luc Luyten of Bain & Company, a consultancy. Capital-heavy approaches to construction bring high fixed costs that are difficult to cut in downturns. Workers, in contrast, can be fired.
One of the factors of construction is "it costs what it costs". Builders are willing and able to pass costs on to consumers and so don't have an incentive for cost savings.
It's pretty ridiculous that you've the whole thread whining about "the trades". A variety of vested interests keep building costs high, with trade unions well down the list. Developers, large, monopoly builders and homeowners' association each as a group have more money than any unions and through a system that bring huge profits by high priced building and land appreciation, they have a vested interest in the high cost of building. Consider that when it's time sell schemes that raise the cost of building, the best "face" can trade union "protecting livelihoods" but that doesn't that's where the real power or money lies.
On a practical note - mobile home parks in my area are blocked by county and city government they serve home-values, out here in the sticks, unions really don't have but we've had no new parks for twenty or thirty years. But oppositely, it's easy to put mobile unit on the high price land you occupy yourself. Yeah, it's land value.
Here is one example where this lobbying was done in the open. There are many many more that don't hit the papers because the topics are pretty narrow/boring but highly impactful. https://www.sfchronicle.com/bayarea/article/San-Francisco-tr...
The claims are fairly well-founded: https://www.sfchronicle.com/bayarea/article/San-Francisco-tr... "San Francisco, trade unions at odds over modular construction - even for homeless projects"
And at the moment the software field seems a lot more financially rewarding to smart, practical young people trying to figure out what field they should go into.
I'd say it's the same process even in China these days.
There was a big stir online few years ago where it came to light that Shenzhen polytech grads have significantly larger salaries, and employment than much more prestigious university graduates.
On other side, I see more, and more Chinese companies becoming carbon copies of American corporates with engineering offices stuffed full of MBA's, and needing 10 SWOT analyses to fix a single line of code bug.
(And in general, I think mechanization is under-appreciated as a productivity enhancer compared to automation... Who is more productive moving something like gravel around, someone driving a 5 ton capacity dump truck or someone overseeing 100 gravel-moving drones with a capacity of 5 kilograms each? Even if the drones are essentially autonomous, the dump truck driver will be more productive in moving the material around because he's driving a big machine and the drones will need someone to manage them especially when there are problems. Or even compare 5 ton autonomous mining trucks with a 500 ton dump truck... the 500 tonner is gonna win. Larger scale machines are still a pretty straightforward way to improve productivity.)
I guess I’m just saying that scaling up your smaller machine to be larger has the same kind of productivity enhancements as switching your smaller machine to autonomous. It is also something humans have been doing ever since the development of domestic beasts of burden.
I met a guy a few years ago who had a plumber role in one of those modular factories... he said he was paid lesser but he likened it to a 9-5 job in a factory, and was ok with the pay.
So the skilled labor content of plumbing a house has decreased over the years.
Every house in my neighborhood has hardwood floors throughout -- it was cheap when the subdivision was built out, but laborious to install. Today, the same class of house would have carpeting or sheet flooring, costing a lot less to install.
Other things like vinyl siding, Romex instead of hard conduit, etc.
You can be a massively skilled electronic engineer, but you don't need to hand solder every board to have a great, skilled, outcome. I guess the answer is all the machinery we employ for larger buildings, but there's no real equivalent for the individual suburban home which still involves most of the manual labor.
OTOH, I, a physicist, used to be a certified NASA solderer.
That was in the days before surface mount.
Interestingly, no electrician I've used knew what inductive coupling was. :-(
Inductive coupling is one of the most fascinating topics in EM. And, is all the power really flowing in the air between the wires? The electricians don’t know that, either.
I'm the one who teaches the chemists to solder. ;-)
Good small time subcontractors show up to the job themselves but train others to do most of the work.
Subs I worked with had pretty healthy markup over what they were paying their workers (>100% when invoicing hours).
The catch is they all had spent years learning the trade, and that part is definitely dangerous. I saw a guy ruin his back being over eager pouring concrete.
Suburban housing is very easy to build. Building 1 storey houses is not a challenge anywhere in the world, and it is possible to build it super cheap even without any capital equipment.
Steel housing is a prime example that even a double digit percentage cost advantage, with it being a very straightforward, and overwhelmingly superior, replacement for wooden framing, doesn't seem to been enough to drive new technology adoption in USA.
It was in 2nd year when I watched a youtube video when some guy actually explained thay you need to heat up the pad on the board, then add solder. I was totally flabbergased.
Soldering was a very minor part of my degree, so it didn't really matter, but still.
I’m thinking that, when you first learned to solder, you remembered the first step but not the second one, and thus got off on the wrong foot.
I think it’s not as bad in single family construction as commercial work, since the activity varies more over the day/week. But still, I can’t imagine my body not breaking if I did this for a career.
OTOH electrical work seems mostly reasonable. If one of my kids wanted to get into a trade that’s where I’d steer them.
You're starting it at best in your mid-to-late twenties? And even if you played sports in HS and go to the gym regularly, your body just isn't used to it and it's past the point where it can quickly adapt and more importantly get used to the stimulus. You're likely much more prone to injury than someone fifteen years older than you whose been doing that work since they were 17 (I'm sure I am too, it would destroy and I am very active for a SWE).
I do consider myself very fit/active, but it’s not the strength or stamina that’s the limiting factor, it’s the holding weight at weird angles, or applying torque, or just reaching out over my center of mass for hours.
Anecdotally it seems like the specialists have it worst. His friends who did flooring all have wrecked knees, and the drywall hangers have messed up shoulders. He seems to have made it out unscathed, though other generalists he knows have back problems.
I've had people come to my house to do handyman work, and at the same age as me, they are hobbling and broken.
I suspect that one of the causes of the opioid crisis is that we had a pain crisis, caused by bad working conditions. I could imagine advising one of my kids to go into the trades, but only if they move to a country with decent labor laws, safety net, and health care. Not in the US.
HVAC installation costs as much as a car in warmer regions.
General handyman work outclasses all retail jobs, but you don't hear about people with two bachelors doing that type of work like you do at a Starbucks.
I'm inclined towards the skilled trade side of things because I like getting my hands dirty but I understand why people wouldn't want to do a job that has you in a shop or working out in the heat, cold, or rain on a regular basis. Not to mention I imagine the injury and/or casualty rate is much higher for many trades compared to desk jobs.
TLDR: We obviously need both and they are equally good fields but I completely understand the perceived higher valuation for the safer, less physically taxing albeit often more boring and sedimentary jobs.
I wouldn't qualify for workers compensation for my herniated disc because I don't know when it started or why. But it's probably from sitting in front of a computer. Asking coworkers over 35, they almost all have injuries from computer work.
Maintaining weight and strength while a huge chunk of your day is sedentary is a big chore too.
I'd argue the public perceives sedentary jobs as much safer because of this even if they may not be in reality.
Why would you ever consider doing that? Livable wage discussions are about what’s livable, not how much value the job provides.
But sure. Let’s tie federal minimum wage to inflation and then do local cost-of-living adjustments, say make minimum wage equal to, say, three times the typical rent for a two bedroom apartment in the area. That way places that might really struggle with $21/hour minimum wage (like Wichita, Kansas) but have low housing cost would be able to maintain adequate employment levels and attract business investment. (It would also force NIMBY-heavy communities like San Jose, California actually have to pay a consequence for extreme housing costs in the form of higher wage costs for local low-skill services… Encouraging more housing to be built.)
A plumber might make a lot more money but they’ll never be able to shake the association with dirty, unpleasant work, despite the fact that a great deal of plumbers work in new installations for construction rather than household repair.
When I think of young and old PhDs alike, I don't think of high status individuals. I think of people who spent too long in academia. Most of them don't contribute breakthrough insights to their field in their lifetime, but rather make indentations to broader collective knowledge. That's not high status to me.
I think more highly of someone who owns their own plumbing business. An employer has more status to me because they command labor. A PhD graduate will most of the time be contributing deep narrow insight to a larger organization, not using their studies for entrepreneurial pursuits.
This is fast changing. The days of "ooh they work in an office" vs. your average handyman are mostly gone US metro areas. If anything, electricians, mechanics, carpenters, firefighters, etc. are seen as "manly men" with the surviving traditional masculinity compared to most men in metro areas.
I know more tradesmen that are leaving the trades than joining, and they are usually the best among their group. Being a skilled framer often nets you nothing over being a barely competent framer. Despite all these claims of trades making huge money, most tradesmen are not. For ever plumber in NYC making $50 an hour, there is a dozen other contractors working for $12 an hour using their own tools and trucks fighting over the scraps of lower class business who can barely afford them.
Every indutry that doesnt reward skill qill eventually go to shit
Hair color and bleach is nasty stuff.
More power to him!
This is largely because of staff shortages.
It's much easier to build a dozen of something when you don't have to deal with 12 different clients/owners.
And sure, the "cost disease" effect makes labor intensive industries seem less productive with apparently too-high-paid people.
https://en.wikipedia.org/wiki/Baumol%27s_cost_disease
In addition, value added per hour can be a sign of productivity loss, but is also impacted by shrinking margins (which they note is the case - but shrinking margins has nothing to do with productivity and everything to do with competition).
Also the article says "Many building professionals use hand-drawn plans riddled with errors" - Hand-drawn plans? This isn't my experience in the UK (I design warehouses and have worked with lots of primary contractors). CAD here is pervasive, and anyone with a hand drawn plan would be laughed out of the room (unless you were literally a builder doing a quick sketch - in which case CAD isn't a replacement).
And the article then recommends... self driving bulldozers as one part of the solution? This is so far away from being safe on a worksite that it's nowhere near an immediate concern.
I’m guessing this explains most of it.
It’s common in the construction industry to compete during the bidding phase by underestimating the time and cost of the project, then making up for it with change orders later. It’s so pervasive in some domains that contractors feel they have no choice but to play the game to get contracts.
The smart buyers employ people who know how to manage contractors and construction companies with contracts that make time and budget overages less profitable for the company. The catch is that you need someone on your side watching the work so they don’t try to cut corners to get the job done. It’s difficult.
At smaller scales, it’s common for contractors to bid more projects than they can handle and then rotate between them, tending to the clients who complain the most. They’d rather overbook their calendar than have gaps in between projects.
Construction and contracting are not fun industries to deal with. Having known reputable contractors is very valuable, but the good ones are often booked out a year in advance.
And I agree about the other oddities in this article. I don’t even know if hand drawn building plans would be allowed in modern towns. Usually a licensed engineer is required to draw and approve the plans and there aren’t many licensed engineers still doing this who don’t use CAD.
Do you mean to say big gov IT contracts ?
We are on HN after all.
This is called change order abuse. Sometimes the contractor actually has an inside person receiving kick-backs or bribes where they can purposefully underbid while knowing in advance that they will be able to make it up with change orders (which will be approved by the inside person)
I've heard about the New Engineering Contract (NEC) system that is supposedly used a lot in the UK:
* https://en.wikipedia.org/wiki/New_Engineering_Contract
* https://www.designingbuildings.co.uk/wiki/NEC4
This is where (AFAICT), contracts are standardized templates, and it is only 'amendments' that are custom for the project: blueprints, bill of materials, timetables (for staging payments), etc, are custom on each job. This (supposedly) allows for fewer lawyers to be involved, and only the 'technical' stuff needs to be looked at.
How pervasive is NEC? Useful at all?
There's plenty of beautiful CAD plans that don't hold up in the real world (this is why as-builts exist). I feel like there could be a scripted tool to check things like code compliance and stop people routing conduits through beams etc.
I need to interface with the electricians, carpenters, HVAC, and the GC on every project. None of them have the same drawings and none of their versions are the latest from the architects and engineers. The architects or engineers are also very expensive, so they rarely get brought back in for updates to drawings once unless it has to do with code / regulatory approvals. This ends up with the client's latest real drawings being a jpeg screenshot of the original plans that they just email blasted to everyone.
All the vendors and boots on the ground definitely have a version of the CAD floorplans, but it was whatever they decided to print out 3 weeks ago when they got this job on their calendar. The workers have just been marking it up by hand since then. This is where a lot for the confusion, delays, and change orders come from. I don't know if this is just what to expect with budgets less than a few million, or maybe it's just retail style projects, or maybe my clients attract poor quality vendors (I guess that says more about me). The only time with no major problem was when one client stuck to one GC over the course of 20 new buildouts. They eventually figured out how to wrangle all their subs together.
Just ask the client to go ask for the DWG, 9 times out of 10 you will get it. Might be different in the USA but that’s my experience in the uk. If there is only paper, we have a CAD guy who can quickly transfer it into CAD in about an hour (there is software specifically for this).
Building something is very labor intensive (the way we do it here in the US; the article talks about China and other ways of building) and the actual proposed budgets should be higher and timelines longer based on how we build.
But in order to win a contract, the builder must lie and say "we can do it for this much and in this time frame," which tends to be lower than what we can actually realize.
Why do the same companies always seem to win?
In my neck of the woods (The Bay Area), one company seems to get all the jobs. The company's name rhymes with Gelato.
I started to look carefully at the bids.
(I got a General Contractor's license a while ago, and it an easy test, and verification of work experience is a joke.)
Ok, I looked into the owner of the contractor's license, and in all three bids, they had a "Gelato" as owner of the company.
It looks like the "Gelato" family sent three kids to Sacramento to take the test, and get their licenses.
They all bid on the same project, and one wins.
They must share the million dollar equipment, and pool of employees though?
Is it legal? I don't know.
Do I know for a fact this is how it works--no.
(There's a bill, I believe up for vote soon, in Sacramento. It requires all bidding parties to verify their company us big enough to do the project. I don't think we need a bill like this. I don't think small companies bidding on huge project to is a problem. If I am right about "Gelato" construction company--authorities should look into the bidding process. There us a reason, besides inflation, that public projects get more expensive each year, and never seem to end.)
Sometimes what looks like cronyism is just someone picking someone they trust to do the job. It can be hard to tell the difference unless there are obvious problems constantly being overlooked - like with NASA contractors for example.
Plus elaborate custom specifications for projects also make it hard to keep track of costs and bureaucrats wind-up fond of these things. Etc.
The industry is rife with corruption and misaligned incentives. Kick-backs are common. Bids are often not truly competitive, and when they are, people find ways like change-order abuse [1] to subvert the system. There are so many ways to rig the bidding process (bribing someone to find out competitor bids so you can undercut them) and the execution (cutting corners that you don't expect someone to find out about, or just bribing whoever is overseeing quality who might detect the corners you cut).
Even the US Army Corps of Engineers has had massive corruption cases. When I was in the industry this was an open secret, which surprising to me given the Foreign Corrupt Practices Act... eventually this would be cracked down upon [2], but as far as I've heard, still common.
[1] https://guide.iacrc.org/potential-scheme-change-order-abuse/
[2] https://www.justice.gov/usao-dc/pr/former-us-army-corps-engi...
It was a family business and I helped out by the managing operations (this was more as a supplier of building material to contractors) and doing business development (which involved bidding for construction projects).
Now it's plastered walls, with large doubled glazed windows everywhere. Laminate floors. HVAC. Extra insulation to reduce heating costs.
And all buildings now need to be wheelchair accessible with lots of ramps, lifts and specialised bathrooms.
Result: Specialised workers at very stage, reducing competition and causing delays.
I’m glad he had a job, but it stems like the builder could have saved a lot of money by just moving a little slower, and doing it right the first time. Then again, maybe the cheaper labor building the houses offset the extra cost.
In its preamble the Economist says: the project encountered a series of successive delays due to poor construction planning, execution, management, and corruption
That would be poor: planning, execution, and management. The corruption was of the best European standard. Quite excellent.
In IT, it happens often that there is a clause that prevents contractors from sub-contracting a position. This forces them to hire for that skill.
What is special about the construction industry that this cant be done?