Angi, the home services company that is the amalgamation of Angie’s List and Home Advisor recently released a very interesting piece of research on the state of the trades. The trades are defined as those local home service providers in the plumbing, electrical, painting, landscaping, and so on.
The research, titled Skilled Trades in America: How the Great Resignation Could Provide Great Opportunity for Skilled Trades, is chocked full of interesting data and corresponding insights.
One of the data points that is affirming of what we’ve often written about in these pages is the emerging retirement of many Baby Boomers. And many of these Boomers own and run local service provider businesses. The data indicates that generally speaking those running the trades are on average 11% older than the overall population. And more than a quarter of all trades operators are within 10 years of the first social security opportunity at age 62.
The consequence of this aging curve is that there will continue to be a shortage of quality local trades providers. Ask anyone you know who’s trying to get some work done on their home and you’ll probably hear that the providers are booked out for six or nine months. That puts considerable pressure on pricing as wealthy, impatient homeowners bid up jobs to move higher in the queue.
While the trades may not be in the same earnings league as investment bankers or VCs in terms of wages, many of the well-known trades — plumbers, electricians, contractors — have annual earnings well above the general population. In fact, they earn 22%, 29%, and 53% more, respectively. In a market where there’s been article after article talking about the “Great Resignation,” the trades offer some of the biggest benefits job seekers value.
One of the really interesting pieces of data focuses on when tradespeople entered the “profession”. Of the older cohort of tradespeople, 33% entered their field between the ages of 16 and 20. Only 18% joined between 25 and 30. That dynamic flips and indicates that 35% of those entering the trades today are between 25 and 30 years old, and only 7% are entering between 16 and 20.
So what’s up here? The research authors point out that since 1980, college enrollment has increased by over 60%. That lines up with the dogma that everyone “needs” a college education to succeed in today’s business world.
And at the same time, the costs of a college education have risen over 400%. And what types of jobs can a college graduate get after a four-year stint? Well if they’re not software engineers, the pickings are slim when it comes to earnings and career satisfaction.
The report points out that more than eight out of 10 tradespeople list themselves as either very satisfied or somewhat satisfied with their jobs. The “Great Resignation” trend tells us most leaving their jobs now wouldn’t describe themselves as very satisfied or even somewhat satisfied.
Underneath those very high satisfaction numbers among trade pros is an improvement in compensation. And the core driver of satisfaction according to the research was “meaning and value.”
Nearly 25% of those extremely satisfied indicated that “meaning and value” was the core driver of their satisfaction level. Ask the same question of a college graduate who is on a sales floor and you’ll probably get a very different answer. One of the other key drivers of satisfaction is flexible work hours. And what is the current white-collar employee demanding today on the heels of the pandemic? More flexible work hours.
The report includes a lot more data to trigger some really interesting discussions. The core point is that the trades world has been somewhat left out of the mobility equation over the last couple of decades. At least they have at the intellectual level.
Will some of the 4.3 million Americans that apparently left the workforce recently show up back in the numbers as owners or employees of trade businesses? Maybe. The point is really that our towns need great tradespeople to fix all those stopped-up toilets.
We hope the pandemic and “Great Resignation” will nudge high school seniors to consider the trades as a career option. We also hope local communities will enact policies supporting the skills training necessary to mint professional-grade tradespeople.