Most of the remodeling company owners we spoke with for this article had to cut wages — and their own salaries — during the recession. But many are reporting that in the past two years they have started to increase pay. As Craig Huseby, owner of Huseby Homes, in Nashville, Tenn., put it, “You can only go so long without giving a man a raise.”
Reporting nationally, the Bureau of Labor Statistics (BLS) puts residential construction laborers’ 2011 mean hourly wage (MHW) at $15.49. Remodeling company owners across the nation who responded to our questions about wages confirm this, reporting laborer salaries ranging from $11 per hour in Ann Arbor, Mich., to nearly $20 in Boston. Similarly, carpenter wages ranging from $16 per hour in Nashville to $25 per hour in Dartmouth, Mass., bracket the BLS 2011 MHW of $19.86.
Lead carpenters are salaried employees in many companies, with pay ranging from $29,000 in Lexington, Ky., to $55,000 in Dexter, Mich. Salaries for project managers range from $32,000 in North Tustin, Calif., to $87,000 in Lexington, Ky. This aligns with the BLS mean annual wage (MAW) of $58,990 for residential construction “first line supervisors.”
Bookkeepers and office managers earned wages as low as $19 an hour or annual salaries as high as $62,000. BLS has no statistics on these occupations within the residential remodeling sector, but overall the MHW for these types of jobs is $17.82 (annualized to a $37,070 salary). Employee experience, job descriptions, and local market circumstances explain the wide disparity.
Gary Rochman, who owns Rochman Design-Build, in Ann Arbor, Mich., says that although his city was “mostly spared” during the downturn, he still had to make changes in salaries. “I gave no raises and no bonuses,” he says. “Then we went down to hourly money for salaried people, then to bare bones billable hours, and finally to layoffs.”
The good news is that Rochman has made hires this year, bringing his total number of employees to nine — one more than he had five years ago. He projects giving employees a year-end bonus this year.
Fifty miles south of Boston, the news is the same for Roland Valois, owner of R.P. Valois & Co. Valois has gone from 38 employees to 10, and hasn’t given a raise to anyone in nearly four years.
But Dave Supple, who started New England Design & Construction, in Boston, during the downturn in 2006, says that he increased salaries and benefits “to get better people.” He admits he “was a bit naïve” but says that, since he wasn’t in business during the boom, he didn’t have anything to which he could compare his experience. “I didn’t know I was actually working harder. I didn’t know any better and didn’t have different expectations.”
In Seattle, Alex Adolfi, owner of Carlisle Classic Homes, had to lay off several employees and stopped giving bonuses. But he continued a policy of giving annual raises of 10 cents an hour for every year someone has been employed at the company. “We do it no matter what,” he says. “It’s a way to reward guys who have stuck with us.”
Buying power of wages
In 2002 the national mean hourly wage (MHW) for a carpenter was $17.09. In 2011 the national MHW for a carpenter was $19.86.
However, to maintain the same purchasing power they had before the downturn, carpenters would need to earn $21.39 per hour.
Since 2002 there has been a 16% increase in MHW, while the cost of living has increased 25%.