When word came that two major companies wanted to build data centers here, the first question was: How many jobs?
Turns out, the two facilities — a Wal-Mart data center and Agilent Technologies' expanded data and tech centers — would bring only 113 permanent jobs, initially, at least. Agilent plans to hire 73 when the center is built, and 58 more over 15 years.
But temporary construction jobs will number in the hundreds, and while many laborers are paid in the $10-per-hour range, some construction workers earn up to four times that.
Now the question is: Does the Pikes Peak region have the workers to build two $100 million projects? And even if the workforce is adequate, will those workers be hired?
Thanks, Uncle Sam
While construction jobs are viewed as grunt labor, those who pour concrete, hang drywall and install wiring have been the bread and butter of the Pikes Peak region's economy for decades.
Even the 2007 mortgage crisis, which benched many home-building workers, didn't mean the end of good construction jobs. Think Fort Carson, where hundreds of millions of dollars have been poured into new brigade facilities and housing.
Currently, Carson has 30 different construction projects under way, not counting the Combat Aviation Brigade facilities due to come here in the next three years, says Mitch Foster, with Strategic Staffing of Salt Lake City, an employment service that helps fill Front Range jobs.
Moreover, laborers working construction on post today earn $18.75 an hour, Foster says, while tradesmen can earn up to $40 an hour.
"Without a doubt, Fort Carson, Peterson [Air Force Base] and the Air Force Academy have been what's keeping us alive in construction the last two years," Foster says. "Without the military, we would be so hosed in this community. It's what's driving the economy."
Now, assuming Agilent and Wal-Mart begin their projects this summer and fall as planned, construction and the spinoff jobs it brings will play an even bigger role.
Kenneth Simonson, chief economist with the Associated General Contractors of America, says George Mason University conducted a study in 2008 to determine the number of jobs typically created by nonresidential construction. Using its formula, both projects combined could bring roughly 1,900 construction jobs, 950 support jobs with suppliers that provide materials and services, and 2,850 jobs in unrelated businesses that benefit from spending by the other two, such as restaurants, car washes and clothing stores.
But Simonson says, "It is hard to put a time frame on how quickly the jobs appear or how long they last."
Paul Rochette of Summit Economics LLC, which studies economic impact, is more modest, estimating the two projects will generate 1,100 construction-related jobs, and 2,420 total jobs, over a two-year period.
But there's no official estimate. Wal-Mart didn't respond to inquiries, and Agilent spokeswoman Amy Flores says, "There's no way to forecast the numbers." General contractors haven't been announced.
Are we ready?
"We will have no problem dealing with this construction effort, because our housing industry is still struggling," says Mike Kazmierski, Colorado Springs Regional Economic Development Corp. CEO. He reasons that because housing starts are a fraction of the normal 4,000 per year, construction workers are available for other assignments.
"These workers are still in the community, because there's not too many other places they can go," he says. In other words, things are tough all over.
But residential and commercial construction are two different things, Foster argues: "It's like night and day. These foremen aren't looking to do on-the-job training."
In addition, as construction has waned, much of the local workforce might have left town or switched gears.
Though the number of licensed contractors and tradesmen, like plumbers, has declined by only 2 percent since 2007, Pikes Peak Regional Building Dept. special projects coordinator Bob Croft notes, "We probably have less [laborers] in the workforce, and people have moved on because there isn't enough work."
Statewide, Colorado has lost 37 percent of its construction workforce since January 2007, a decline from 164,500 to 103,900 in April this year, according to Pikes Peak Workforce Center data. In the Springs area, 12.6 percent of the 3,893 workers who say they're in the construction industry, or about 490 workers, are unemployed.
Still, Matt Vineyard, senior project manager for contractor JE Dunn of Colorado Springs, is optimistic. "I don't think there's any doubt the local and regional labor force can support the Wal-Mart, Agilent and other projects in the community," he says.
While some general contractors have been known to bring work crews with them, Vineyard says locals have the edge, because they don't require housing allowances and they have expertise in local building codes.
The best scenario would be for a local firm to get hired as the general contractor, and Vineyard says Dunn, which has built several data centers, wants to bid on it.
If the general contractor comes from out of state, the best jobs might go to those with ties to the general contractor, says Kyle Whitesell, vice president with Bob Moore Construction, Inc., of Arlington, Texas, which has built several data centers.
"I worked several deals in Colorado over the years, and we've pulled from Denver, and we pulled a lot from Dallas-Fort Worth, some from Salt Lake," he says, adding that the general contractor is likely to hire subcontractors, foremen and supervisors whom he knows. "It's hard to say whether those construction dollars are going to stay in Colorado Springs. Probably not."
At the International Brotherhood of Electrical Workers Local 113 union hall, workers are abuzz over getting a piece of the action, says business manager Charlie Johnson. "I would hope that Wal-Mart and Agilent would utilize the local labor force," he says, noting it's local taxpayers who are subsidizing the projects through incentives. He adds that a Denver contractor who helped build Hewlett-Packard's data center here in 2009 hired 90 to 95 percent of its electricians, including 130 IBEW members, from Colorado Springs.
"To say we don't have the skills or ability to do data centers," Johnson says, "it shouldn't even come up in the discussion." He also disputes the idea that home construction workers aren't capable of commercial building.
In any event, how the jobs will be advertised isn't known. They might be posted on monster.com or other websites, says Pikes Peak Workforce Center spokeswoman Jeanne Cotter. "I would suspect a lot of them already know how to reach people and would go to people they've used in the past, which is unfortunate."
A hiring event last week at the workforce center for 100 commercial remodeling jobs drew roughly 80 applicants. Carl Meisel, 56, was among them. Having worked construction all his life, commercial and residential, Meisel has earned as much as $40 an hour. But he's been unemployed for most of the past two years, and his jobless benefits have run out.
"I've gone through my savings," he says.
Unless he gets work soon, he says, he's thinking about leaving town. In the late '80s, he went to Las Vegas, where construction was booming, and wound up staying there 12 years.
So while he's hopeful about the data center projects, right now he's looking to land a more immediate remodeling job at a Wal-Mart store in Fountain. It pays $7.80 to $8 an hour.