Friday, January 30, 2015

Construction Trades

I believe that our country is in a crisis due to a drought in new business start-ups.  One path out of this crisis is to look at business sectors that still have large numbers of new business start-ups and tease out the factors that make them special.

Any observer who starts down this path MUST look at construction trades.  My guess is that people in construction trades are five-to-ten times more likely to start a business than the general population.

Total Masonry Maintenance

One of my standard interview questions is:
"Suppose a niece or nephew came up to you and told you they wanted to start a business.  What two or three pieces of advice would you offer them?"

I was very interested in James O'Conner's answer.

  1. Have a little bit of money saved up in case things don't happen exactly as you planned.
  2. Have a plan.  Know where you want to be in five years.
  3. Work hard.

 Have a little bit of money saved up

A decent financial planner will tell you that you need to have between two and six months living expenses saved up.  They recommend two months for those people who have very stable jobs.  The recommend six months for people with erratic income streams;  people who sell on commission, people in construction trades.

In addition to having money saved to live on, the business owner needs money to run the business.  Permits need to be pull.  Payroll met.  Gas put in the truck(s).  If you are starting out your suppliers may want earnest money up-front.  So that six months of savings must also be able to support the business.

Have plan

No builder would consider starting a building without plans.  The plan does not show every brick or every nail but it does have "details" showing how problem areas are to be dealt with.

People in construction trades have a very pragmatic balance of planning and action.  They are results oriented.   The focus is on getting the job done rather than finding a perfect way to do something or whining about inconveniences.  They know that the customer won't pay you until the job is done.

Two electricians show up at a trench that filled up with water over night.  There is an inch of ice on top of the ice.  They flip a coin.  The loser spuds a hole through the ice and climbs down into the trench.  The winner keeps the truck running and keeps up a running conversation with the loser.  When the guy in the trench can no longer manage coherent answers, the winner pulls him out of the trench and warms him up in the truck.

That is just what construction trades do.  They get it done.  A typical MBA would still be looking through catalogs trying to find the best price on a pump when the construction guy climbs out of the trench for the last time.

Work hard

Everybody has work when times are good.  The hard workers, the one's who give their customers a little bit extra are the ones who will have work when times are bad.

Customers ask around.  They might not know any masons (for instance) but they will ask people in other construction trades.  They will get an earful.

You can ask an electrician who they think are the best tin-knockers, plumbers and carpenters.  They will have very definite opinions because they run their wires around and through their work.  They know who works quickly and neatly.  They also know who is sloppy and has to finish the end of the last run with duct tape and chicken bands.

The dry wallers can tell you who runs the best roofing crews.  The rough carpenters can tell you who pours the squarest foundations.

A construction trade person is not only constantly judged by others in their trade, they are also being judged (often times quite severely) by people in other trades.  Slackers are shown no mercy.

Other factors

Can do attitude

People in construction trades have a lot of confidence.  They see buildings go from unbroken sod to tenants moving in.  They have the technique of breaking big projects down into simple, repetitive steps
  • Strike lines
  • Mix mortar
  • Butter a brick
  • Tap brick into place
  • Shave squeeze-out off with trowel
  • Slap squeeze-out where next brick will go
  • Butter next brick (repeat 15,000 times)
You step back after laying the 15,001st brick and you see that you just built a 2800 square foot house.  You built it one brick at a time by following a plan.

State licensing

Uber-libertarians will cough up a hairball on this point.

Licensing makes labor more valuable by turning it into a commodity like a gallon of gas (pumps certified by the State) or a silver coin (content guaranteed by the mint).  The title "Master Electrician" or "Master Plumber" means very specific things.

Union structure

This is another factor that will cause uber-conservatives and liberatarians to retch.

The union hall functions as a hiring hall.  A tradesman might work for 24 different employers in the course of a year.  It is inevitable that any person with gumption will come to the conclusion that they can do better than many of these guys.

Most tradesmen can quickly identify which foremen (bosses) are best at making quotes, getting the crew started in the morning, assigning tasks, coordinating the smooth delivery of supplies, get along well with people, and the one's who never bounce a check.  They can also tell you why those guys are good at what they do.  The trick is to be the boss/business owner who does all of those things well.


  1. I've never had a problem with unions in the craft trades, as long as they don't act as an impediment to commerce. Everyone in the business should know what the going wage is for a journeyman craftsman, and as long as the contractor offers that wage, they should show up for work and put in an honest day's labor.

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