Angie’s List co-founder: It doesn’t take a ‘tidal wave shift’ to tackle labor crisis

Angie’s List co-founder: It doesn’t take a ‘tidal wave shift’ to tackle labor crisis

Angie Hicks has a unique perspective on construction.

As chief customer officer of Angi — formerly Angie’s List, which Hicks co-founded — she has decades of experience working with entrepreneurs in the trades and consumers. That gives her unique insight into how the construction industry is perceived.

A recent survey from Angi, the Skilled Trades in America report, found that contractors and employers struggle mightily to find and hire skilled workers, and 77% say it’s getting worse. At the same time, tradespeople are largely satisfied with their work. Women who work in the skilled trades flourish, reporting high satisfaction as well.

Construction Dive spoke with Hicks about the state of construction labor — both commercial and residential — and what needs to change about the industry’s image and recruiting performance.

The following has been edited for brevity and clarity.

CONSTRUCTION DIVE: In your opinion, what is the current state of employment in the trades? How did we get here? What can be done to improve the situation? 

A headshot of Angie Hicks.

Optional Caption

Permission granted by Angi


ANGIE HICKS: I think there’s two sides of the story. So one, I think it’s really important to point out that people that have gone into the trades are having great careers, very successful careers. And in fact, in our most recent survey, over 80% of those surveyed say they really enjoy what they do. So when I think about what drives us to be successful and what makes us happy, if you enjoy your job, you’re doing great. On the flip side, people in the trades are struggling with finding more quality talent. About 70% of folks surveyed that are in the trades have said hiring and finding people to join the trades is a challenge. 

And it’s been like that for some time. It used to be that the trades were something people joined right out of high school. That 16-to-22-year age period was the most popular time for people to join. But now it’s becoming later. The average age of people in the trades is in the mid-40s. And we’ve got a lot of people that are getting ready to retire. 

What can be done to get the industry back to that 16 to 22 age bracket?

I think we also need to think about making sure that we have a lot of the trades opportunities and classes available in high school. A lot of the trades people that we’ve talked to have commented on the fact that shop had been erased from a lot of high schools, which really hurt the number of people going into the trades because they weren’t getting exposed to it. 

I think we are at an interesting time right now, and we need to take advantage of it. I think a lot of younger people are rethinking their investment in education as far as what they’re getting as reward. You know, one of the things that was challenging about the pandemic is that some younger folks that were high school age just became a little more disengaged with school because they were learning remotely. And that is opening them up to thinking about other opportunities. But we have to step in and make sure the trades are front and center as viable, so that we make sure that we win if the tides shifted at all. 

You don’t need a tidal wave shift to start to fill in these jobs. You need to be prepared and be nimble to go and take advantage of that market. 

Is it time for a cultural change?

I think so. And I think a lot of times you’re not seeing people talk about it, how young people are saying, “Hey, I want a much more technical job.” A lot of the trades are becoming much more technical. If you’re going to be an HVAC technician, there’s more computer hardware in a furnace today than a lot of the mechanical hardware of the past. I think that’s going to make a change, because of the skillset that’s going to be required by the products that are powering our homes and buildings.

I would be remiss to not say this: The trades are still a male-dominated industry. How do we create more diversity in the trades? I was talking to a woman in Brooklyn the other day who started her remodeling business probably a decade ago. She’s passionate about trying to get more women to go into the trades. And it’s like, how do we do that? How do we break down that barrier? Because I think there’s a lot of interesting opportunities. And I think we just recruit to what we know. We need to broaden that.

It’s the same issue that the first woman in the boardroom was like, “Okay, I’m in a room with a bunch of men.” It’s like the first woman at the plumbing company. How are we creating an environment that gives them role models and opportunities to see a path to success for themselves? I think the companies have to think about how they are creating a culture that’s open to a more diverse workforce. 

What would you say to someone who pushes back on that? Who says it’s a woman’s job — or any workers’ job — to find their place in the company culture, not the other way around?

Well, I think that that could be the challenge which causes us to not have enough labor. Like these same companies can’t grow and are turning down jobs because they can’t find enough talented folks to do the work. So, I think if you choose to stay small, that’s fine. But if you want to grow and take advantage of the opportunity, I think you need to think about how you are going to best position yourself to attract the talent that you need.

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Vistry eyes 20,000 homes a year build target

Vistry eyes 20,000 homes a year build target

Vistry has said it is looking to grow its business to deliver up to 20,000 homes a year in the medium term, an ambition which if achieved would make it the biggest housebuilder by volume in the UK.

Speaking after publication of the firm’s full year results yesterday, Stephen Teagle, chief executive of Vistry’s partnerships housebuilding division, said the business was looking to create a “platform” from which it could produce 20,000 homes.

Teagle’s comments came after the business, which pulled off a £1.1bn takeover of rival Countryside in November last year, yesterday reported statutory pre-tax profit of £248m for the 2022 calendar year, on turnover of £2.73bn, up 13.4%.

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The firm said it expected to increase “adjusted” pre-tax profit – prior to exceptional items – from the £418m reported yesterday to more than £440m for the current year, and had experienced “increased consumer confidence”.

Teagle told Building’s sister title Housing Today that with the acquisition of Countryside the firm’s partnerships business, now re-branded as Countryside Partnerships, was on course to build around 11,000 homes in the current financial year, more than double the just over 4,500 in the year just gone. He added said there was now capacity in the business to increase partnerships housing volume to 12,000 homes a year.

Earl Sibley, Vistry chief operating officer, said he expected the traditional housebuilding business of Vistry to produce 6,000 homes this year, slightly down from the 6,774 in 2022, but that it now had a capacity to increase production to 8,000 a year.

Teagle said the acquisition had capped a “transformational year” for Vistry and added: “We’ve now got a platform that would allow us to deliver 12,000 homes in partnerships and an ambition in our house building business to in the medium term to deliver 8,000 homes.

“So, the group as a whole is really targeting an ability, through the operational platforms we’ve got, through our excellent strategic land banks, through our brilliant procurement partnerships, and our partnerships with housing associations, through our MMC factory, to deliver 20,000 homes a year.”

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Teagle did not compare Vistry to any other housebuilders or say there was an ambition to be the biggest in the sector. Barratt, which built 17,545 homes last year and is currently the largest housebuilder in the sector by volume, already has a target to increase output to 20,000 homes a year. But so far it has not managed to hit the number and has recently said it expects volume to contract to between 16,500 and 17,000 this financial year in response to the current economic conditions.

This means that Vistry could be the largest housebuilder in the UK as early as this year by number of units built if it hits its expectation to produce 17,000 homes this year, albeit partnership housing tends to deliver slightly lower revenue and significantly lower margins.

Teagle also confirmed on the call that Vistry will look to use the off-site timber frame factories inherited from its purchase of Countryside to supply homes for housing association partners.

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Mortgage Rates May Drop Despite Fed Rate Increase

Mortgage Rates May Drop Despite Fed Rate Increase

The Federal Reserve raised a key interest rate one-quarter of a percentage point on Wednesday, the same level of an increase as in its previous meeting seven weeks ago. Repeating that small hike might not seem dramatic, but after a turbulent couple of weeks for the global economy, the 25-basis-point boost is a pretty big deal.

In early March, the economic data seemed to indicate a larger rate hike would be warranted at this month’s meeting and Fed Chair Jerome Powell acknowledged the long road to lower inflation could be “bumpy.” However, the economy hit some massive bumps days later, with two significant bank failures sowing chaos in the markets. In addition to prompting the Fed to recalibrate, the upheaval caused a stampede into bonds, which could push mortgage interest rates downward, even as the Fed continues to raise rates to quell inflation.

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How the Fed’s plan was knocked off course

Following a 25-basis-point increase at the January/February meeting, it seemed likely that the Fed would yank interest rates upward more decisively at the beginning of this month. That’s because economic data kept showing the economy running hot and the rate of inflation remaining brisk. February’s consumer price index found inflation at 6%. 

On March 7 and 8, Powell spoke before Congress, emphasizing that the Fed’s decision-making would be data-driven, seemingly laying the groundwork for larger rate hikes.

“If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes,” Powell remarked. Markets took this as a sign that a 50-basis-point increase could be the outcome of the March meeting. 

Then the U.S. experienced its second-largest bank failure in history, as a rash of depositors scrambling to withdraw funds collapsed Silicon Valley Bank on March 10. (Disclosure: NerdWallet banked with SVB before its closure.) Then, scarcely 48 hours later, the third-largest bank failure occurred, with regulators taking charge of Signature Bank and SVB. This sent markets into turmoil over fears of a wider-spread banking crisis. 

Suddenly the Fed’s path forward was much less obvious, especially because rate hikes had played a role in the demise of Silicon Valley Bank. SVB’s liquidity crisis arose when depositors panicked following an announcement that the bank had sold bonds at a loss. SVB lost money on those longer-term bonds because higher interest rates made those assets — purchased when interest rates were significantly lower — less valuable.

“The collapse of two large banks drives home that we do have problems in the banking system, which could get worse if the Fed moves too aggressively going forward,” Dean Baker, senior economist with the Center for Economic and Policy Research, said in an email last week. “It looks like the actions taken by the Fed and Treasury have stemmed the panic, but there is no doubt that the rapid series of rate hikes over the last year have increased risks in the financial sector.”

Why mortgage rates could actually fall

Mortgage rates had been on an upward trajectory in 2023, with annual percentage rates, or APRs, on 30-year fixed-rate loans firmly in 7% territory right around the time Powell spoke before Congress. But as bank failures upended the markets, mortgage rates took a tumble.

That’s because rattled investors began looking toward the relative security of government bonds. With interest rates high and economic uncertainty looming, bonds seem like a safe place to park assets. That’s pushing up bond prices, which tends to lower fixed mortgage rates. 

With the Fed apparently toning down today’s rate hike, mortgage rates could plateau. Or, if anxious investors keep buying bonds, they could even fall. That’s something mortgage lenders may be open to, as interest rate increases keep pushing potential buyers out of the housing market.

And unless home buyers truly become acclimated to higher rates — which for now, they certainly aren’t — mortgage lenders arguably have every incentive to lower interest rates as soon as they can.

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Why High Rates and Lower Prices Shouldn’t Deter Home Sellers

Why High Rates and Lower Prices Shouldn’t Deter Home Sellers

The 2023 housing market may not be great for either buyers or sellers. But for current homeowners hoping to play both roles, it could be the right time. 

When entering the housing market, current homeowners have to consider twice the (often conflicting) circumstances — they are the seller, trying to get the best price for their current home, and a buyer, trying to purchase their next house at a reasonable price point. In a “balanced” market, with roughly even amounts of buyers and sellers, that’s not an impossible feat. But when the market is heavily tilted to one group or the other, a win-win scenario is less likely. 

One in 10 (10%) current homeowners plan on buying a home in 2023, according to NerdWallet’s 2023 Home Buyer Report, which asked in late December who planned on buying within the “next 12 months.” This is on par with the share of owners who said they planned to buy when we asked one year earlier. But repeat home buyers in 2023 are not facing the same circumstances as buyers in 2022.

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“Mortgage rates rose so fast last year that they scuttled countless deals. People made successful offers and then, when they were ready to close six weeks later, they discovered that they couldn’t afford the monthly payments because of those rates,” says Holden Lewis, NerdWallet home and mortgages expert. “This year, rates are more stable. Buyers can be choosier because they are in less of a hurry to lock their rate and close on the purchase.”

Mortgage rates may slow (but not stop) sellers 

When asked what’s preventing them from purchasing a new home, 26% of homeowners cited current mortgage rates. This apprehension isn’t without cause. Rates for 30-year fixed mortgages peaked in the fourth quarter of 2022 at just over 7%, after hovering around 3% in 2020 and 2021. It’s a marked increase, but not the highest rates have gone. 

Still, nearly 3 in 5 (59%) current homeowners say current rates are “unprecedented,” according to the Home Buyer Report. In fact, rates on 30-year loans have averaged around 7.75% over the past 50 years. At last check, they’re just over 6.5% — high, but below the historical average, and certainly with precedents. Looking back at 50 years of January mortgage rates and their effect on payments for a home purchased at today’s prices can provide some valuable context. 

For example, a $287,000 mortgage would carry principal-and-interest payments of $1,290 if you were paying the average rate in the fourth quarter of 2012: 3.5%. However, paying 13.03%, the average rate in Q4 1982, would result in a $3,184 payment.

Home seller insight: Every fraction of a percentage point increase in rates stands to boost your monthly housing expenses, and home buyers should always take rates into consideration when setting their budget. However, higher rates don’t have to curtail your goal of selling your current home and replacing it with one better suited for your needs. 

One way home sellers are at an advantage when compared with first-time buyers is they’ve generally had more of a chance to build their credit history. Qualifying for the lowest rates available requires a history of responsible credit usage and on-time payments, and having paid on a mortgage for several years can document that track record. 

Repeat buyers should also keep in mind that they can refinance if rates come down. If you get a 30-year fixed-rate mortgage — the most common type — you don’t have to keep that same mortgage for 30 years. If rates come down, you can refinance it to take advantage of lower interest rates and potentially save tens of thousands of dollars over the life of your loan. Millions of homeowners did this in 2020 and 2021 when rates were so low.   

Prices have fallen, but values are still up from 2020

Home prices climbed precipitously during 2021 and 2022. In fact, these prices kept many would-be sellers in their current homes — they didn’t want to pay top dollar for their next home even if they could make a handsome profit off their current one. Now, however, home prices have turned a corner. Growth has stopped, and in many cases, prices are coming down. For a current homeowner, this means a lower list price and less potential profit. But failing to list a home for this reason alone could be a mistake. 

Prices went so high during the pandemic era of the last three years, it would take a pretty deep plunge to undo the gains. Nationwide, homes are valued 40% higher in January 2023 than they were in January 2020, according to the Zillow Home Value Index. Even if you take into account the effects of inflation, they’re still 21% higher. 

This trend is seen in even high-demand markets, such as Austin, Texas. There, January 2020 home values grew 61% to a peak in July 2022, before beginning to fall. However, they’re still 49% higher than January 2020. Thus, owners who found a house they liked better would still be making a considerable profit if they sold today. 

Home seller insight: Rising home prices have meant rising equity for you over the past few years. In most markets, those prices have stopped rising, and in some, they’ve come down. Homes are not cheap in this market, but you won’t spend as much on your next home as you would have last year, and you’ll have less competition as you enter the market as a buyer. As a seller, you’ll also be able to take advantage of the equity you’ve built, pricing your current home well above what you would have just a few years ago. 

“Hire a savvy agent who will help you set a reasonable asking price,” says Lewis. 

“Buyers of previous generations customarily would offer tens of thousands of dollars less than the asking price; then the two sides would negotiate to somewhere in the middle. Then, in the heated housing market of 2020 and 2021, buyers got into bidding wars and ended up paying more than the listing price. 

“Now we’re in a new phase, in which buyers don’t want to make lowball offers or get into bidding wars. They’ll make offers on sensibly priced, move-in ready houses.”

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Government unit investigating 19 firms who have not carried out fire safety work, minister confirms

Government unit investigating 19 firms who have not carried out fire safety work, minister confirms

A specialist unit set up to go after firms who refuse to carry out fire safety remediation has opened 19 inquiries, the building safety minister has said.

The recovery strategy unit (RSU) was launched last year by the Department for Levelling Up Housing and Communities to investigate firms which repeatedly do not carry out work when asked to do so.

Lee Rowley, building safety minister, speaking to MPs yesterday, said: “There are many different leads at the moment, they have to be triaged. Then there are a series of individual cases which are chosen and there are 19 live inquiries or activities underway.”

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He added: “They [the RSU} are building up their capacity, they are building up their knowledge, they are building up their experience.”

Rowley said the RSU would not be able to pursue every case but its purpose was to put the industry on notice that it would take action when required and “change behaviour on a broader scale”.

>>See also: Gove threatens to put 11 housebuilders who have not signed cladding contract ‘out of business’

>>See also: Second staircase rule forces Westminster council to redesign 1,100-home estate regeneration

In January, housing secretary Michael Gove said the RSU has active investigations under way into the conduct of those contractors and construction product manufacturers which he said “bear responsibility” for the building safety crisis.

The unit began its first major action last year, giving block owner Grey GR Limited Partnership 21 days to remediate its 15-storey Vista Tower block in Stevenage, Hertfordshire, or be taken to court. Grey GR is owned by asset manager RailPen.

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Job cuts at Tarmac

Job cuts at Tarmac

The GMB union has called on Tarmac’s bosses to think again about the planned 10% reduction in headcount.

GMB organiser Dave Warwick said: “Tarmac is a household name, trusted and respected across the building, manufacturing and construction industries. Many customers will be scratching their heads about why the company is choosing to act in this way. Local managers are reporting back that these cuts are leaving them with a depleted and frankly dangerous staff level.

“Tarmac workers and GMB members are understandably worried about what these job cuts will mean for the company and where capacity to cover sick leave, holidays and parental leave will come from.

“This all while company top brass, including Tarmac’s owner CRH, are trousering eye-watering profits and pay packets. The highest paid boss at CRH is on a reported £12.4m pay package, unimaginable wealth compared to the very workers they’re threatening with job losses.

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“Tarmac must step back from the brink on job losses, work with GMB and find a solution that works for its workforce.”

A spokesperson for Tarmac said: “A consultation process is under way with employees on proposed changes to the internal structure of our operational business, designed to make it more effective, create more consistent and nationally aligned structures in our frontline teams, and continue to provide our customers with our range of sustainable construction products, services and solutions.  

“As part of a consultation process, we are engaging with unions including the GMB on our proposals. 

“Tarmac employs around 7,000 people UK wide, with a small percentage of our overall workforce involved in the current consultation process. Impacted employees will be fully supported throughout the process.  The safety of our employees is of paramount importance to us and remains central to all our business decisions.”

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