Flooring industry reacts to its installation crisis
The Floor Covering Leadership Council (FCLC), a coalition of 11 flooring industry trade associations, convened its annual fall meeting in Orlando to address installation—the most vexing issue facing the flooring industry.
The meeting, which coincided with its second annual installation summit, prioritized objectives and confirmed a plan of action for the coming year.
The industry leaders acknowledge they cannot solve the challenge of installation until the scope of the problem has been formally quantified and analyzed. Their objective is to quantify the scope and severity of the lack of installation professionals on industry sustainability and growth.
Industry executives say there are three facets to the installation challenge: the dearth of installers today in an aging industry; the declining skill level of existing installers; and the need to recruit the next generation of installers. At a recent Certified Flooring Institute (CFI) conference, it was noted that the average flooring installer working today is 56 years old.
The FLCL announced that the member associations would fund a comprehensive research project in order to give a clearer picture of the severity of the growing installation challenge and the level of resources it would need to ensure long-term industry growth. An experienced research firm will be engaged to conduct the work. An FCLC-member task force will recommend the research firm. The project will be completed in early 2018.
A tool maker celebrates growth
Empire Level, a division of Milwaukee Tool, greeted local officials including Wisconsin Gov. Scott Walker this week to celebrate the company’s growth. During his visit, Walker met with company officials and toured Empire’s Mukwonago, Wisconsin, manufacturing plant.
Buoyed by partnerships with Milwaukee Tool, the Wisconsin Economic Development Corp. (WEDC), Milwaukee 7, and local governments, Empire now has more than 200 employees. Eighty of the hires came after a $16 million investment from Milwaukee Tool to support plant upgrades and product launches.
“Empire Level’s success is a testament to our commitment of driving growth and creating new jobs in Wisconsin,” said Steve Richman, president, Milwaukee Tool Group. “Our strategic partnership has delivered tremendous growth which is focused on developing innovative solutions for our users and The Home Depot customers. The investments we’ve made in people, training, plant upgrades, and quality processes at Empire will allow us to continue delivering on this partnership.”
In February 2016, WEDC awarded $18 million in enterprise zone tax credits to support expansion efforts by Milwaukee Tool. The credits are tied to job retention, job creation, and capital investment.
Gov. Walker said Empire Level and Milwaukee Tool are committed to growth and creating new manufacturing in the state.
“Both of these long-time Wisconsin companies are teaming up with local colleges and universities on worker training initiatives to close the skills gap and recruit engineering talent,” Walker said. “The commitment shown by companies like Milwaukee Tool and Empire is a major reason why Wisconsin will continue to lead the way in manufacturing and worker training.”
A rising story: home prices
Let’s review the housing market metrics for July. Housing starts: down. Single-family housing starts: down. Existing home sales: down. New home sales: down.
But against this backdrop of declines, there’s a major metric on the upswing: housing prices.
The headline from a recent Zillow.com news release tells the story: “Home values higher than ever in almost half of nation’s largest markets.”
Home values in Denver, Dallas and San Jose have appreciated most beyond the previous record-highs set at the peak of the housing bubble in the mid-2000s. Homes in Denver are almost 60 percent more valuable now than during the bubble, increasing from a median home value of $235,900 in April 2006 to a current median home value of $371,100.
The latest report from the National Association of Realtors shows the median existing-home price for all housing types in July was $258,300, up 6.2% from July 2016 ($243,200). July’s price increase marks the 65th straight month of year-over-year gains.
According to Zillow’s Real Estate Market Report, strong labor markets and steady income growth have pushed up home values in the nation's hottest markets more quickly than in others. Among the 35 largest housing markets, 15 have higher median home values than ever before.
Affordability is an issue, and inventory is even more of an issue, according to Zillow’s Svenja Gudell, chief economist.
"Home values are high, but affordability – while suffering a bit lately – is still OK, largely because of very low mortgage interest rates helping to keep monthly mortgage payments in check," said Gudell. "The more pressing issue is abnormally low inventory, which is translating into an extremely competitive environment for home shoppers. Bidding wars and homes selling for over asking price have been common themes in many markets this summer, and continued competition in the face of limited supply will only continue to push home values up going forward.”
For more major metric information, visit the Quikrete Industry Dashboard here.