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The_Best_Industry_in_the_United_States
| The Best Industry in the United States
Best Industry in the United States
My 17-year-old child is going off to college. She is starting
ask questions about industries and careers. She has made me
think further about what construction contracting has to offer
her. I have concluded it is the best career a young person could
choose. You may not believe it, however the facts will show our
business is unmatched. It offers participants long term tangible
benefits. Many people will argue however, let me show you the
many virtues our industry has. You be the judge.
Merit Based – the construction industry
rewards hard work. There is no substitute. We are all
dissatisfied with the work ethic today. When we find it, we
reward it. Let me give you an example – a person comes to you
(male / female) doesn’t speak of English well but has promised
to work hard and keep their nose clean. You give them a chance
and 1 year later, you are glad you did. They kept their promise.
Now, what will you do? Ignore them? Cut their pay? Of course
not. You will increase their wages and give them more
responsibility. Construction contractors reward merit.
Additionally, the industry is also. Let me show you. What is the
best advertising in the construction business? A completed
project on time and on budget. This speaks volumes of a
contractor’s savvy and diligence. Word of mouth travels fast.
Excellent contractors have more opportunities for work than
their lesser competitors.
Small is Big – Construction rewards the
small construction firm. That is they make a higher percentage
of profit. This is a variable cost business. In other words, you
do not have to have “critical mass” to be profitable. Net profit
statistics consistently show that smaller contractors make a
higher percentage of profit before tax than their larger
brethren do.
Tangible – Our industry erects
monuments. Our work is visible to everyone. We can see it for
decades after we complete it. Construction people show friends
and relatives point out these projects. Unlike other industries,
we see what we accomplish every day.
Best Earning Years Later in Life –
Statistically, this is difficult to prove. However anecdotally,
a case can be made. In my travels working with clients in the
United States, A contractor's profitabilty grows over the years.
I have seen increases as either percentage or gross dollars or
both. Construction becomes more profitable with experience.
In contrast, the best earning years of most other industries is
between 35 and 50. (Professional Sports excepted). The reason
for this youthful compensation is energy, the willingness to
travel, to take risks and to make extraordinary things happen.
Profitable construction is based on consistent and correct
processes, somewhat like the manufacturing business. The more
consistently a person does the correct things, the better the
outcome.
In our opinion, construction contracting consists of two
components – people and processes. What does an older executive
have over a younger one? The knowledge and experience handling
people and building projects. (They have the scare tissue to
prove it!) My conclusion is a contractor’s best earning years
tend to be in their 50’s and 60’s.
No Consolidation – The construction
industry is an owner – operator business. Efforts to consolidate
have shown the power of the small business – you cannot beat an
owner who is risking his wealth every day. Large firms are at a
disadvantage. Again, small is big.
Local – Where can a construction
company be started? Anywhere! Construction expertise is needed
in all fifty states. It does not need a port facility or wide
open spaces to operate. You can start one where you live and
that is family friendly. An important consideration these days.
No college degree needed – Construction
people who have worked in the field for several years have the
equivalent of a college degree. A majority of construction
knowledge is earned while working not studying. Technically, you
learn how to install quality work with your own two hands. I
strongly believe that someone who has owned and operated a
construction business for 20 years has a master’s degree maybe
even a Ph.D. No large capital investment
needed – Some successful construction firms have been
started with no money. Beginning capital is not a major
obstacle. This is a cash flow and variable cost business. To
start, a person does not have to float an IPO or have a rich
uncle. What they need to do is understand the economics and have
technical expertise.
Shortage of people wanting to be in it
– Industry economists agree that we still have a shortage of
people employed in Construction. Conservatively, the number
needed is 150,000. As we have learned in our lifetimes, the
Demand / Supply curve is very powerful. A shortage of anything
drives the price up. Competent people earnings have outstripped
general wage increases in other industries. That is job security
as well as wealth building. Ask a computer programmer or airline
pilot about over supply of people and the effect on wages and
opportunity.
Non-Importable – The trend of
outsourcing to other countries has grown in the last several
years. Take your pick: Computer Programming, Manufacturing or
Engineering. Construction is insulated from this problem. Put
bluntly, you cannot dig a hole in the Orient and import it into
the United States. The majority of labor must be “insitu” or at
the project site.
What other industry has all these attributes. The answer is
none. Although, the perception persists that our industry does
not have much to offer young people. It is not true. Surveys
have shown people in construction do not recommend our industry
to their children. We must stop this habit. I challenge each of
us to promote our industry. Let the truth be told.
matt stevens can be reached at mstevens@stevenci.com
About the author:
Management Consultant to Construction Contractors since 1994.
Has over 25 years experience, Held over 300 seminars across the
country. Worked with dozens of contractors throughout the
nation. Spoke before over 10,000 construction owners and
industry professionals
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