Dive Brief:
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Quicken Loans founder and billionaire Dan Gilbert announced Wednesday that his plans for four Detroit developments — worth $2.1 billion combined — will create up to 24,000 temporary and permanent jobs, 15,000 of which will be construction-related, according to the Detroit Free Press.
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The projects are a restoration of the historic 38-story Book Tower; a $900 million mixed-use, residential skyscraper; a 35-story downtown office tower; and an addition to another office building. Gilbert also said Amazon's proposed new headquarters, which has yet to pick a location, could bring 50,000 jobs to the city.
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Gilbert has driven significant redevelopment in downtown Detroit. As of July, the city had 70 projects worth $5.4 billion in progress or in the planning phase for the next three years.
Dive Insight:
While Gilbert's projects could very well generate the number of construction jobs he estimates, where those workers will come from is likely to be weighing heavily on his development team.
Like many other areas of the country, Detroit is suffering from a skilled-labor shortage. Contractors on the Red Wings' new Little Caesars Arena were fined a total of $2.9 million through March for not meeting the agreed-upon local hiring requirements. City officials said the construction companies on the project have acted in good faith and have tried to recruit and train city residents, but the supply just isn't there.
Perhaps there is nowhere more reflective of the current labor shortage than Hurricane Harvey–ravaged Houston. The Greater Houston Builders Association said the storm and its subsequent flooding destroyed around 30,000 homes and damaged several thousand more, CNBC reported. Local contractors, who had significant work backlogs prior to Harvey, are now overwhelmed and are having to tell anxious customers that it could be years before they can repair their homes.
The National Association of Home Builders has come out in favor of a guest-worker program that would allow immigrant workers to help fill the labor gap, not only to help rebuild in Houston but also to meet regular demand across the country.
In June, President Donald Trump signed an executive order instructing the Department of Labor to direct $200 million in job-training funds toward the creation of 5 million apprenticeships over the next five years. However, the administration's proposed 2018 budget would cut the DOL's job-training services overall by 21% and women's training programs by $1 million.