Casey Cazier protected his eyes with sunglasses as he sawed a piece of lumber in half to repair a wood fence that was blown off the hinges by 100 mph winds during the Marshall fire.
Over the past two decades, Cazier’s general contracting business has focused on replacing roofs and other parts of homes that were damaged by hail, severe winds and other storms.
Now, he knows his business will be tested, as the company shifts from fixing and repairing homes to rebuilding them from scratch.
In the next 30 to 45 days, Arvada-based Lincoln Contracting expects to take on a dozen clients who need their homes rebuilt in Superior, Louisville and unincorporated Boulder County.
Cazier said he would take on more rebuilding customers if he could, but skilled labor is in short supply. Lumber and other materials crucial to building a home are also scant and far more expensive than they were a year ago. And even buying new appliances, like stoves or washing machines, could take many months.
The devastation comes amid a supply chain crisis for construction materials, and during a labor market shift where fewer people are opting for construction-related careers. Both of those factors are compounded by a backlog of homes that should have been built recently, but were delayed by the COVID-19 pandemic, which is again surging.
“All of those three things come together, and then you have a fire — with all of a sudden — a big need for reconstruction,” said Stephan Weiler, professor of economics at Colorado State University. “I feel for those folks, because they’re running into this at a particularly bad time.”
The Marshall fire consumed nearly 1,100 homes in just six hours on Dec. 30, making it the most destructive fire in Colorado history, in terms of the number of homes burned. The loss of those homes is estimated at about $513 million. One man was killed in the fire and a woman still is missing and presumed dead.
Even with delays that could drag on for years, Cazier expects people to at least begin planning their replacement homes, which could cost anywhere from $600,000 to $1 million each.
“If I had skilled managers, we could do 30 (homes),” Cazier said. “If we end up getting eight to 10, I’ll bring another project manager to help us, just because I need skilled labor and there’s not enough of it here. I think the biggest thing is just being sensitive to these people that literally lost everything.”
‘People who lost homes are likely to rebuild’
On Tuesday, a few workers were cleaning up charred rubble at the intersection of West Coal Creek Drive and Fourth Avenue near Superior Marketplace. Occasionally, curious onlookers drove by, slowing their vehicles to get a better view of the destruction.
Gov. Jared Polis has said rebuilding will be a long-haul effort because of supply and labor shortages already straining the market.
People who lost their homes are likely to rebuild. Their neighborhoods are considered desirable because of proximity to jobs in Boulder and Denver, and easy access to amenities, such as trails in the foothills and mountains.
Under normal circumstances, it wouldn’t be unusual for a home to be built from scratch in six to nine months, said Paul Goodrum, a professor and head of the construction management department at Colorado State University.
“I think, in this region, you’re probably looking at maybe double that,” he said. “I’ve heard some estimates of maybe up to two years.” Other housing professionals estimated it could take up to three years to rebuild.
A supply shortage
Construction industry experts said the largest supply shortages for construction are in lumber, copper, windows and home appliances.
“For instance, windows: It’s not that we can’t get them, it’s just, they used to take 30 days,” Cazier said. “Now, they might take three months. There are definitely delays in getting products because of availability.”
A spike in recent wildfires in the U.S. and Canada has created a shortage of lumber and each fire creates a bigger demand for renovation and construction.
Nearly 60,000 wildfires burned 10 million acres in 2020, compared with the 50,000 fires that burned almost 5 million acres in 2019. By Sept. 14, almost 45,000 wildfires had already burned through almost 6 million acres of land in the U.S., according to the National Interagency Fire Center.
There are also slowdowns at sawmills, where logs are shaped into lumber. Many were shut down during the COVID-19 pandemic and were slow to reopen. Those factories have had to increase wages to get workers back on production lines, which has increased the cost of many products.
Currently, 1,000 board feet of lumber costs $1,200. One year ago, that same amount of lumber cost $830, according to Trading Economics, which tracks the price of commodities.
“It’ll be interesting to see what happens now, not just with the fires here in Colorado, but with the tornadoes in the Southeast,” Goodrum said. “All that just creates huge demand now for content for reconstruction.”
Prices for copper, used to make electrical wiring and some components in heating and cooling systems, have also spiked amid a national shortage and increased demand from emerging industries, including electric vehicles and solar panels.
Shortages in the supply chain for components, including stainless steel and computer chips, are making it tough to find major appliances, such as stoves, ovens, dishwashers, washers, dryers and refrigerators, which are frequently imported from overseas.
Shipping a standard 40-foot container of goods from China to the U.S., for example, costs $16,000, said Zac Rogers, assistant professor of operations and supply chain management at Colorado State University.
“That number should really be like $2,500,” he said. “For that to be $16,000 is pretty crazy because … the average value of the stuff inside one of those containers is somewhere between $50,000 and $100,000.”
“What COVID has shown, and what this crisis has shown,” Goodrum added, “is that it’s not always quite so easy to get products from abroad — halfway across the world to the United States — even if it can be built cheaper halfway across the world.”
The labor shortage
A labor shortage is occurring at the same time as the supply shortage. The labor shortage in the construction industry has worsened over the past 40 years, and it has become increasingly difficult to attract skilled professionals into the industry. For example, in the U.S., “We are 50,000 to 100,000 truck drivers short of what we need,” Rogers said.
Some of the biggest shortages are in highly skilled trades, including among plumbers, pipefitters, electricians and equipment operators, Goodrum said.
When the U.S. unemployment rate was 3.6% in July 2019, there were 350,000 openings in the construction sector, not much higher than a year later, when there were 325,000 openings even as the pandemic pushed the unemployment rate to 10.2%, according to the U.S. Bureau of Labor Statistics.
When the National Association of Home Builders surveyed members about top concerns for 2021, the cost of building materials rose to the top. Labor dropped to third place after being at the top in 2019.
Construction jobs have been relatively slow to recover from the pandemic in Colorado. The state has recovered 86% of its jobs that were lost from February through April 2020, compared to the national number of 83%. But, in Colorado, only 36% of the jobs lost in the construction industry have been recovered since the start of the pandemic, according to the Colorado Labor Market Information Office’s most-recent November statistics.
Labor economists think people are reassessing their purpose in life as the COVID-19 pandemic drags on and many are considering other job opportunities as they care for themselves and their families, Weiler said.
Others may consider construction work “dangerous, dirty, or physically demanding work,” Goodrum said. And while there’s been movement toward building as much as possible inside factories, most construction work in Colorado still occurs outdoors, where temperatures can become sweltering in the summer and frigid in the winter.
Construction industry professionals, by their nature, are more mobile than the average worker and may be more willing to move between states for bigger projects, making it harder to attract or retain them, Weiler said.
“I think we have done a very poor job of attracting more women in construction, and so, when you look at the typical craft professional workforce, most of it is men,” Goodrum said. Less than 5% of craft professionals are women.
Over the past 40 years, there’s been more focus on motivating young people to attend a four-year university rather than an apprenticeship, for example, where construction industry professionals can become certified.
“I think as a society, we have lost respect for that kind of work, and I think it’s a real shame,” Goodrum said.
The current period is bleak for Marshall fire victims and people who survived other recent disasters. But there’s a glimmer of hope for people looking to rebuild their homes locally, Goodrum said.
In the U.S., there’s a “remarkable ability” to rebuild compared to other nations. After Hurricane Katrina, for example, damaged manufacturing facilities and petrochemical plants were restored within a year or two when many people thought it would take much longer. After earthquakes hit the San Francisco Bay Area, in the 1990s, major interstate systems were rebuilt within a year, when normally that process would easily take several years, Goodrum said.
There’s also a strong possibility that a larger cleanup effort will occur, where community members come together neighborhood by neighborhood to help each other in removing debris. During a recent planning call about rebuilding efforts, there was discussion about communities hoping to work together to help make the reconstruction much faster and cheaper, Goodrum said.
Construction work may be difficult, but those industry professionals will soon be in demand, and their work will “tremendously” benefit the community, Goodrum said. “They’re absolutely incredibly important to helping us renew our infrastructure systems, and to helping rebuild communities, when those communities are in need.”