Page 9 - Green Builder November-December 2018 Issue

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Green Building NEWS

The Latest on Sustainability and Renewable Energy
Skilled Worker

Problem Gets Worse

As the construction industry’s labor
shortage grows, so do safety hazards.
ABOR SHORTAGES are more than just a manpower problem
for the construction industry. They’re also creating a safety
hazard for the workforce that exists. According to the latest
L commercial construction index from Dodge Data & Analytics,
58 percent of contractors consider the lack of skilled workers to be CREDIT: NASA
the No. 1 reason for jobsite safety risks.
In addition, nearly 40 percent of contractors are “highly concerned” Storm warning. Disasters like Hurricane Florence in 2017 are driving up
insurers’ costs—which will most likely be passed on to customers.
over the safety impacts of worker use and addiction to opioids, followed
by alcohol (27 percent) and marijuana (22 percent). Most contractors
say they have strategies in place to reduce the safety risks from those Global Warming May
substance abuse problems, although they are clearly less equipped to
Turn Insurance Into
take on the opioids crisis, according to Dodge.
High Stakes Roulette

A growing string of natural disasters may

lead to huge insurance increases for
businesses and homeowners.
CREDIT: JOHN JONES£FLICKR LIMATE CHANGE MAY TURN INTO A GOLD MINE for insurance

companies, who may begin raising rates once they finish
recalculating their catastrophe models. According to a report in
Risky business. Worker safety rivals the lack of skilled labor as the C the Wall Street Journal, a growing number of global warming-induced
natural disasters have insurers looking for ways to recover their costs, as well
construction industry top concern heading into 2019.
as predict how they will change in the future.
The opioid epidemic cost the construction industry $95 billion in Insurance losses from just two of last year’s hurricanes—Harvey and Irma—
2016, and could account for approximately 20 percent of the observed surpassed $100 million combined, according to global reinsurance brokerage
decline in men’s labor force participation, according to Neil Bradley, chief and consulting firm, JLT Re. This year’s most-recent hurricanes, Florence and
policy officer of the U.S. Chamber of Commerce, a co-sponsor of the Michael, could double that total. Wildfires, such as the slew that hit California
Index with USG Corporation. this past fall, will tack on at least another $1 billion in claims, according to the
As for skilled labor, 88 percent of contractors believe they will state’s insurance commission.
experience at least a moderate impact from not having enough help. Fifty- “It takes a lot of premium, a lot of margin, to account for this increased
seven percent expect the impact to be very high, according to Dodge. uncertainty, and I’m not sure we’re doing a good job of reflecting this and
“The commercial construction industry is growing but the labor charging appropriately for it,” Arch Capital Group CEO Marc Grandisson says.
shortage remains unresolved,” says USG Corporation President and “We need to incorporate a greater range of possible outcomes into our pricing.”
CEO Jennifer Scanlon. “As contractors are forced to do more with less, Expect insurance rates, which thus far have posted modest increases, to
a renewed emphasis on safety is imperative to the strength and health eventually be jacked up based on forecasts, the Journal notes. In addition,
of the industry. It continues to be important for organizations to build
rates are re-evaluated yearly, so increases are likely to continue for quite a
strong and comprehensive safety programs.” GB
while. Those rates changes could go across the board, impacting homeowner’s,
automotive, business and liability coverage.
The Q3 2018 USG Corporation and U.S. Chamber of Commerce “We don’t discuss the question anymore of ‘Is there climate change,’” says
Commercial Construction Index is available for download at
Munich Re CEO Torsten Jeworrek, a seller of insurance for insurers. “For us, it’s
https://uscham.com/2CBUHT1.
a question now for our own underwriting.” GB
www.greenbuildermedia.com November/December 2018 GREEN BUILDER 7

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