If you look at priorities among home building business leaders since recovery started to get traction in 2012 or so, you can see why a shortage of new talent entering the ranks is the issue it is.
Except for a few [dozen] rare enterprises, the need for money–for acquisition, construction, and development financing–demanded more executive-level attention than any other urgent matter. Without capital a company can’t have any other problems or opportunities, because there’s no company to speak of. And, it hardly needs to be said, capital was hard to find for a long time.
The challenge to add and sustain a sound and supple capital structure that enables most builders to put developed lots out in front of them, let’s face it, takes a lot of the best and smartest leaders more time and focus than most of them want to admit.
Add to that the fact that the faster-recovering markets have been more concentrated geographically, with the result that more competitors chased the same capital, the same lots, the same construction infrastructure, and the same talent pool. This ups the ante on every front, making money, land, people, and home buying customers more expensive to secure.
If those same business leaders were not sucked into the vortex of having to pursue fresh flows of finance so much of their time, what else might they have been doing?
One of the things they were always good at, and would be good at again if they weren’t so busy having to line up another land acquisition capital deal to get another 24 months of lots lined up in their market, would be to solve the challenge of bringing on a next generation of talent into the business.
We kid ourselves to say that talent is not out there, and that young people these days, simply are not interested in the business, the trade, the livelihood, and the culture of building homes and communities for people.
It’s that priorities and focus and passion have concentrated–necessarily, mind you–on securing money to keep the lights on and buy another deal, rather than on the work of constantly having to go out and find that up-and-coming customer care specialist, that rock-star sales associate, or that construction super, or any other part of the team it takes to win in this business.
A ceo of a top 20 private home building company we know well drives a five-plus year-old Honda Accord, and comes to work one morning after getting an oil change. He gives his head of construction a card and says to him, “Could you call this young fellow at Jiffy Lube and ask him if he’d like to come in and talk to us about that superintendent position we’ve got open? He doesn’t know anything about building, but, boy, is he a hard worker.”
That kid from the Jiffy Lube is now one of the young up-and-comers at this company. So, too, is the young woman they courted out of the job she was doing behind a counter at a local jewelry store, who’s now an overachiever on the home sales front. Cruise directors, hotel registration desk attendants, bartenders, even some guys spending a lot of time at home in shorts and slippers, growing ZZ Top beards, day-trading … they’re the ones who are home building’s future.
Bring them on, and then you go to the next step, focusing on the winning people over to come in to the trades.
More often than not, these young hard-working people who are plying their skills in other, unrelated fields are one inspiration moment away from productive and fulfilling careers in home building. They haven’t yet had the epiphany that happens when a young couple takes the keys and deed to their first new home, or the sight of a group of children assembling for the first time waiting for a bus to take them to a brand new community’s new elementary school.
They haven’t had the president of a home building company do his or her thing to lure them in to join the team, because those presidents, more often than not are too busy doing a dog-and-pony show to win over new lenders and investors.
If financial capital kick-started housing’s recovery, it’s human capital that will kick it up to another level and keep it going.
Yes, training is sorely needed and the skilled trades are where home building’s focus is right now. But, if you don’t draw people into the field in the first place, then you’re not going to have anybody to train.
We’re seeing bright spots where company leaders have made it their business to go out in to their local communities and work to bring new people into home building. That’s what it’s going to take to motivate people like Graciela Arias, Andrew Brannan, Shanetra Brown-Armstrong, Josh Leach, and Colton Revels to try it out and get hooked when that inevitable magic moment happens and they see and feel for themselves what it’s like to make a new home for a family.
