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The Honolulu Advertiser

Posted on: Sunday, December 28, 2003

CONSTRUCTION
Building boom means lots of jobs

By Andrew Gomes
Advertiser Staff Writer

Building for the long haul
Corinna Kyle, 36, left office work to become an apprentice carpenter last year. Though the work is hard, it is more interesting, pays better and should provide long-term job security given the construction boom, she said. Kyle lives in Wai'anae, is married to a Navy engineer and has six children.

Deborah Booker • The Honolulu Advertiser

Move over, nene. Hawai'i's other state bird, the construction crane, is back.

Like a lost migratory animal, the crane joke had not been regularly heard in more than a decade, that is, until recently, lightly emphasizing what has become one of the primary drivers of state economic growth.

How long the cranes and robust construction activity will stay is impossible to say for certain, though economists suggest the industry will continue to expand next year and peak beyond 2004.

A recent University of Hawai'i/Bank of Hawaii report forecasts construction spending will reach $5.4 billion next year, a 17.4 percent increase over this year, and a mere $100 million short of the $5.5 billion record set in 1991 during the height of the Japanese investment boom.

"Construction in Hawai'i is on a roll," wrote report authors Carl Bonham, a UH associate professor of economics, and Paul Brewbaker, the bank's chief economist.

Their projection is based on a dramatic increase in building permits for work on residential, commercial and government projects, such as high-rise condominiums, military housing reconstruction, time-shares, senior-living communities, big-box stores and the UH medical school.

Last week, Gov. Linda Lingle also asked the Legislature to approve $539 million in construction spending for state projects in addition to the $310 million capital improvement budget previously approved by the Legislature for 2003-05.

Actual industry growth could be complicated by labor availability, land use and permitting approvals as well as a significant rise in interest rates.

But Bruce Coppa, managing director of Pacific Resource Partnership, an alliance between contractors and Carpenters Union Local 745, said the industry's long-term outlook is better than ever.

"I think the next 10 years will be the best 10 years in the history of the construction industry in Hawai'i," said Coppa, who is hopeful there will be major improvements to state harbors and maybe construction of a mass-transit system in addition to the military's roughly $3.5 billion commitment to upgrade housing on O'ahu starting next spring through 2014.

Bonham and Brewbaker said in their report that the military initiative alone will redefine the industry's traditional boom/bust cycle, dampening any future cyclical slowdown.

The overwhelming flow of planned projects is so great that Jeff Palesano, a superintendent with Royal Contracting Co., doesn't worry where his next job will come from. Frankly, he's too busy to have such thoughts.

Palesano has been in the local construction industry for 10 years, and moved to O'ahu from Kaua'i in mid-2001 because work was getting a little slow.

Now he splits his time between two single-family home projects in Hawai'i Kai, Leolani and Koko Villas. He's also recently worked on the Lalea hillside stabilization project, Lunalilo Home Road median landscaping and Kaluanui Senior Apartments nearby.

"It's long days ... I'm tired," said Palesano, who oversees infrastructure job crews working 10-hour days, six days a week, with an occasional seventh day on Sunday.

One of the difficulties Palesano said he deals with regularly is obtaining quality labor, something other contractors also face as the availability of construction workers grows increasingly tight.

Bonham and Brewbaker predict that the industry, which added 2,000 jobs this year, will need another 1,550 workers next year, bringing the job count to 29,500.

They also said that because state unemployment is at a low 4 percent, builders will face increasing pressure to deploy productivity-enhancing technology and techniques.

Coppa said the good news is that the industry has time to prepare, and is busy training and recruiting workers in what should be enough time to satisfy labor demands, especially for carpenters primarily needed for the military housing work.

Satisfying the demand are people like Corinna Kyle, a 36-year-old mother of six who last year got out of relatively mundane administrative office work for more physical labor as an apprentice carpenter.

Kyle takes half-day carpentry classes every Saturday and has helped build tennis and archery facilities at Gentry Waipi'o and a media building at Wai'anae High School.

"The money is good," she said, knowing that her hourly wage of $12.36 could rise to as much as $32 with experience. "I see it as being steady for the next 10 years at least."

If the industry is as steady as expected, Pat Borge Sr. and his family will be happy. Borge, a veteran construction worker born and raised on Maui, recalled previous industry slowdowns where he had to fall back on commercial diving in the early '80s, and then follow construction work to O'ahu and the Big Island in the early '90s.

He's been home since 2001, and worked on a Makena condo, followed by more than a year as carpentry steward for the Westin Ka'anapali Ocean Resort Villas, a 280-unit time-share scheduled for completion in April 2005.

"If there's work, I work," said Borge, 62. "If I gotta go outer island and work, I can go. But it looks good. There's a lot of work on the map."

Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.