Connecticut has both a construction worker shortage and a housing shortage. 

A recent report from the Federal Housing Finance Agency found that Connecticut had the seventh-highest percent change in housing prices across all states between the first quarter of 2023 and the first quarter of 2024. Housing costs increased 9.64 percent during that period, outpacing the national average of 6.6 percent.

That increase is, at least in part, a supply issue. A June 2024 issue of a joint publication by the Connecticut Department of Labor (DOL) and the Connecticut Department of Economic and Community Development (DECD) found the number of permits issued for new home construction has been declining for 20 years.

Quarterly housing permits peaked at 2,367 in the final quarter of 2004. Since that time, they’ve never risen above 2,000 permits per quarter. In the first quarter of 2024 there were just 959 housing permits issued.

One explanation may be a shrinking workforce. Between 2018 and 2023, construction jobs in the state have declined by 4.2 percent. At the same time, across the entire United States, the construction workforce has grown 4.4 percent. This discrepancy comes despite Connecticut having an annual median wage for construction workers that is nearly $8,000 higher than the median annual wage for construction workers across the United States.

And this isn’t explained by the COVID-19 pandemic. While construction employment did take a nosedive in early 2020, losing around 10,000 jobs, employment in the industry peaked at the beginning of 2008. At that time, the industry employed 69,000 construction workers. Today, there are around 62,900. 

While the housing shortage has drawn a lot of political attention, the impact declining numbers of construction workers have on the industry has received less attention. But, according to experts, fewer workers not only means fewer houses being built, it also means building them is more expensive.

Connecticut not only has a shrinking construction workforce—it has an aging construction workforce. And that may not be entirely organic—laws governing how many apprentices contractors can hire, and other forms of occupational licensing, likely play a role.

Construction workers are just one of hundreds of occupations that are licensed by the state. Proponents generally argue that licensure promotes health and safety and improves the quality of services. Detractors point to a wealth of studies showing that licensure frequently makes goods and services more expensive and reduces the number of available service providers. Most practically, for workers looking to enter a field that is licensed, it means chasing down a series of requirements needed to begin working.

While requirements for each specific job differ, common elements of occupational licensure include educational prerequisites, such as a specific degree requirement, training requirements, application fees, and continuing education requirements. Many licenses also have to be regularly renewed, sometimes as frequently as annually.

Altogether, this can require an investment of thousands of dollars—hundreds of thousands if a secondary or postsecondary degree is required—before some professionals can legally work a day in the state.

According to Connecticut Business and Industry Association (CBIA) vice president of public policy Chris Davis, Connecticut is one of the highest cost states for total fees associated with licensing. Davis cited a 2022 study by the Institute for Justice (IJ) that found, on average, it costs would-be workers $290 just in fees to obtain licensure. That’s higher than the average across all states, which was $284.

In addition, the study found it takes an average of 374 days to complete the education and experience requirements for many licensed low- and moderate-income jobs.

Practically, this is “really a barrier for individuals looking to start their own business or get into a trade.” Davis said, also noting that is particularly a barrier for low-income and disadvantaged groups.

Licensure isn’t necessarily straightforward either. For example, Connecticut has more than one type of contractor license. The state distinguishes between major and minor contractors, with minor contractors falling into two further categories. Home improvement contractors and new home construction contractors have two separate licenses. Home improvement, according to the Department of Consumer Protection (DCP), which oversees licensure, includes “any permanent change to residential property” while new home construction includes either “contracting to build a new home” or “building a modular home and delivering and securing to the property.” Depending on the work they do, contractors may need both licenses.

Would-be builders can also get a major contractor license if they’re interested in building structures at least four stories high or 150 feet wide.

Home improvement salespeople, defined as “any individual who negotiates or offers to negotiate a home improvement contract with a consumer, or solicits, or otherwise endeavors to procure by any means whatever, directly or indirectly, a home improvement contract from a consumer on behalf of a home improvement contractor” require a different distinct license.

But the list doesn’t end there. Even those licenses aren’t necessarily all-encompassing for the work required in building a home. Plumbing, heating, electrical, and other forms of skilled work require additional licensure.

Under a page on DCP’s website dedicated to helping consumers navigate hiring a contractor so work is done “correctly and safely”, the agency lists the following additional licenses that may be required of construction workers: crane and conveyor work; electrical work; elevator work; fire protection work; glass work, home and auto; health product (propane stove and fireplace) work; heating, piping, and cooling work; home inspection; irrigation work; operating stationary engineer; plumbing work; sheet metal work including ductwork; signs and outline lighting; solar energy work; spa and pool work; TV, radio, and electronics work; and well drilling. Each of these comes with its own cost.

There are also three levels of licensure: apprentices, journeypersons, and contractors, which are the highest level of licensure. Licenses are progressive: to become a contractor, you must first be a journeyperson for a stipulated period of time. And to become a journeyperson, you must first complete an apprenticeship program.

All three levels of licensure have different requirements. For apprentices, the largest component is hours. Each trade license has different requirements for the number of work hours apprentices must log, under the supervision of journeypersons or contractors, before they can apply for a higher level of licensure. The requirements range from 2,000 hours to 12,000 hours. Each apprentice license also contains requirements for how those hours must be broken down. Carpenter apprentices, for example, are required to spend at least 800 hours on form building, learning skills like building and placing different kinds of concrete forms.

According to Jim Perras, CEO of the Home Builders and Remodelers Association (HBRA) of Connecticut, the workforce shortage is a national problem. But Connecticut’s workforce shortage is owing to a somewhat more unique factor, namely, its aging workforce, which Perras said is older on average than most of the rest of the country.

An aging workforce is a regional problem in the Northeast. States from Pennsylvania to Maine have above median workforce ages. The median age of construction workers across the United States is 42 according to 2023 Bureau of Labor Statistics data. Connecticut, and the northeast in general, exceed the national median. According to 2022 data from the National Association of Home Builders, the median age of construction workers in Connecticut was 44. 

And while that may not seem like that big an age difference, roughly 42 percent of the overall construction workforce is age 45 or older. The median age of construction workers is also at or below the median age of workers across the nation in 32 states, mostly in the Midwest and West.

Another challenge Connecticut faces, according to Perras, is probably more familiar to most people following the news over the past few years: a production shortage, leading to fewer housing units available than are needed.

“We’re building between 5,000 and 6,000 a year right now. And we’re being told by the statisticians out there that we’re short about 96,000 to 105,000, depending on who you ask.” Perras told Inside Investigator. “From a logistical standpoint, to keep up with what we currently need, it will take us nearly 20 years to get there if demand remains flat.”

That shortage affects not only supply, but the turnaround time between when a permit to build a house and certificate of occupancy are issued, and the cost as well.

“The longer you take to get a certificate of occupancy, the greater the challenges you have in financing, with taxes on a property while you’re building it.” Perras said.  “It just really has an overall negative impact on housing production.”

So, why is Connecticut’s workforce older than the national average?

According to Perras, ratios are part of the problem.

Connecticut has a one-to-one ratio for apprentices to licensed professionals at work sites, meaning that for every apprentice who sets foot on a work site, there must be one licensed journeyperson or contractor. It applies to all 80 licensed trade apprenticeships

Other states have similar ratios. Surrounding Massachusetts, New York, and Rhode Island all mandate one-to-one ratios for most trade apprenticeships. Some more “liberally-minded states,” Perras notes, have higher ratios, closer to three-to-one, which “allows contractors to take on more apprentices and put them to work more quickly.”

But Connecticut also has an additional ratio for hiring apprentices. For every one apprentice a company hires, it must first hire three journeypersons or contractors. The only exception to this is the first three apprentices, which have a one-to-one ratio. 

“By the time you get to apprentice four, you have to first hire three new journeymen. That makes it difficult, particularly for mid-size to smaller contractors to hire.” Perras said.

“The reality, too, is there are kids or young adults coming out of training, technical schools, or private institutions ready and excited to get hired and become an apprentice. And there are those contractors that are eager to hire them. But they just can’t. It’s an unnecessary bottleneck.” Perras added.

The hiring ratio applies to electrical, plumbing, heating, piping, cooling, sprinkler fitting, and metal working trades. Employers can request an exemption, known as ratio relief, from the Connecticut Department of Labor (DOL). DOL has received 305 requests from 250 companies and granted 276 since 2017, the last time the General Assembly passed legislation touching on the hiring ratio. While the initially proposed bill would have increased allowable hiring ratios, the final bill created a working group to study hiring ratio relief and present an annual report.

Other efforts to reform the hiring ratio have similarly gone nowhere. This leaves Connecticut at a competitive disadvantage because none of the states it shares a border with have a hiring ratio, which means there are fewer procedural barriers between apprentices who have been certified and work.

That’s not true in Connecticut, where the hiring ratio means that a firm interested in hiring an apprentice may not be able to because of the number of contractors they employ. And young workers may be leaving the state as a result.

“You’ll find young adults going to where they can work.” Perras told Inside Investigator. “We’re competing not just against others but ourselves as well.”

They also may be giving up and looking for a different line of work according to Rep. Tim Ackert, R-Bolton, for which they don’t have training.

To Ackert, who is a licensed electrician and owns an electrical contracting company, the hiring ratio is inexplicable. He’s spoken repeatedly about the hiring ratio and has been involved with several attempts to bring forward legislation to amend it, including during the most recent session.

Ackert called the rationale behind the hiring ratio “very hard to understand.”

“The hiring ratio makes no sense, no sense at all in today’s market of not having enough tradespeople. There’s less occupational licensing in my trade than there was 20 years ago.” Ackert told Inside Investigator. “The population has grown. There are more buildings to serve. Essentially, to have the hiring ratio limits the amount of people—imagine any business that limits hiring people. How many businesses are begging for employees? Nurses, doctors, restaurants, everyone begging for workers. In my business, we have people ready to get in the field and we by law block them. By law. We have a law that says we can’t get workers into this trade. I can’t come up with a rationale.”

“Many states don’t have any licensure requirement at all. We not only have a licensure requirement, and a registered apprenticeship requirement, but we also have hiring ratios.” Ackert added.

Ackert further noted that the only thing the hiring ratio is doing is driving up rates for trade work, which is not good for consumer business.

“I could be selfish about my own business. I could say keep it the way it is so then my business makes more money. That makes no sense. It gives us no chance to serve our clients. Half an hour ago, we had to turn away a job because of staffing reasons, because we don’t have people.” Ackert said.

Why, then, does the hiring ratio exist?

Ackert says unions have been one of the primary reasons efforts to reform the law have gone nowhere.

“It’s unions right now, and not really licensed unions, non-licensed folks, they’re the ones really pushing back.” Ackert said. “And I have nothing against unions other than them stopping this change. We need large union contractors that can come in and handle big jobs.”

According to Ackert, non-union contractors sponsor, train, and hire 87 percent of apprentices.

“And their voice is the one shut out. People who employ, invest, and train apprentices are the one being neglected in this conversation. It’s the union voice that hires 12 to 13 percent that has said we don’t want this and told the legislature, don’t raise that bill. We don’t want a public hearing on it. The chair of the committee can say okay and not raise the bill and shut out the voices of the public.”

Worker safety is another argument that has been used to push back against changes to the ratio.

In 2017, HB 5301, the bill that originally proposed to change hiring ratios and was altered to create an apprenticeship working group, received little feedback and a public hearing and even less feedback that was critical.

The state Department of Labor (DOL), which regulates registered apprenticeship programs in accordance with state and federal law, submitted testimony opposed to the bill’s original language.

“Current law provides apprenticeship and journeyperson hiring ratios at a rate that requires employers to hire more journeypersons than apprentices. The intent of the law is to ensure that enough journeypersons are on staff at any one employer in order to provide adequate mentoring to apprentices, particularly job training and safety.” wrote Scott Jackson, then the DOL commissioner. “I urge the General Law Committee to consider that any change to this law, could increase the chance that apprentices would not have the proper guidance, thereby threatening their training and safety.”

But, as both Perras and Ackert, noted, many other states—including Connecticut’s neighbors—don’t have a hiring ratio. Additionally, both noted that recent legislation introduced in Rhode Island looked to flip the apprentice to contractor ratio, allowing every contractor to manage three apprentices. 

“Look outside our borders. Rhode Island is a one-to-one state. They’re our neighbors, right next door. And they want to go in the opposite direction.” Ackert said. “I don’t think we need to move to that. I think many businesses would be happy with one-to-one. But they see the need in Rhode Island to open up good paying jobs.”

Ackert, like Perras, noted that the hiring ratio and the workforce shortages it is creating, mean Connecticut workers are at a competitive disadvantage.

“There are people coming to us from the federal side, saying here’s money to invest in the state. We have the money, we have the businesses. But we don’t have businesses able to hire and fill the need to do the work. It’s not going to get done by in-state contractors, maybe contractors coming in from out of state, taking Connecticut jobs.” Ackert stated.

Eliminating the ratio, Ackert argued, would not only be good for trades, but for the state as well.

“If we change the ratio, we’d have more good paying jobs, more income tax, more jobs being done. Sales tax, sales tax on materials being used, sales tax on labor would all increase. On the consumer side, prices would stabilize or maybe go down because of more competition. It baffles me that we have any reservation to change this law.” he said.

Additionally, Ackert said that, despite opposition, he will introduce a bill addressing the hiring ratio when the legislature reconvenes in January. 

“I will work as diligently as in the past with committee chairs. We have contractors reaching out, saying they want to grow the workforce. We have to defend the value we want to grow the workforce. We want to help businesses fill job slots. And we’re getting blocked. Nowhere does anybody comprehend this.” Ackert said.

In addition to revisiting the hiring ratio, another step the state could take, Perras said, is prioritizing pre-apprenticeship programs in public schools. More vocational education, Perras said, was “tossed by the wayside” in the 1980s to steer children towards postsecondary education. “The labor workforce has suffered ever since.”

In 2022, Stonington High School became the first school in the state to launch a pre-apprenticeship pilot program for the construction trades. The district launched the Pre-Apprenticeship Certificate Training (PACT) in partnership with the HBRA, the state DOL, and the Home Builders Institute, a national nonprofit that provides trade skills training.

The program teaches students a variety of skills they’ll need to work in construction trades, such as tool handling and identification, and construction math. 

“It gives them an intro into carpentry, plumbing, HVAC, electrical. Kids are coming out with a certificate in a nationally recognized program, one of two recognized by the U.S. Department of Labor, and get a Connecticut Department of Labor Certificate. In addition, any employer that hires them gets to apply 200 hours of on-the-job training to any apprenticeship program moving forward. That’s pretty remarkable right off the bat. Imagine if unions wanted to pick them up and put them in apprenticeship, compared to other kids who don’t have that certificate. I think they would fare better.” Perras said.

To date, the district hasn’t had to pay for the majority of costs associated with the program.

“Since the beginning of the program (three school years ago), we have had the good fortune to have the professional development, curriculum platform and assessment costs covered through grant funding provided by HBI. The costs associated with the teacher and all materials are funded through the district’s general budget.” Stonington superintendent Mary Anne Butler told Inside Investigator.

HBI offers a Schools to Skills grant, which is funded in part by The Home Depot Foundation, to help schools launch PACT programs.

DOL also helped the district get the program approved and ready to launch in the fall of 2022.

But funding is a sticking point in expanding the program to other districts. Perras said that a lot of districts that have been shown HBI’s pre-apprenticeship programs thought highly of the program, but either weren’t sure where to get the funding to start it or were unsure how they would maintain the program moving forward.

“The challenge with pre-apprenticeships is, a lot of these programs cost money. They need woodworking space to do that, in reality oftentimes reallocated from something else.” Perras said.

Stonington does not currently track the percentage of graduates from the pre-apprenticeship program who find job placements, though they are working on being able to do so, but the program has seen growth in both the number of students entering and completing the program. According to Butler, there were nine students enrolled the first year and nine, or ninety percent, completed the required credentials. The next school year, enrollment grew to 32 students, with 29, or 91 percent, earning credentials. For the current school year, the program has 27 students enrolled.

Butler said the Connecticut State Department of Education (CSDE) hasn’t inquired into the status of the program at all.

In 2023, CSDE was tasked with creating a pre-apprenticeship grant program as part of an omnibus education bill. The bill, which was signed into law, required CSDE to award “grants to any local or regional board of education that incorporates a pre-apprenticeship program in its curriculum for grades 9-12” as long as it is registered with DOL and meets related criteria established by CSDE. The law also required the department to award grants of at least $1,000 to students who completed the program.

However, while the law passed, Perras said the program never went anywhere because there was no money put into the budget to fund it.

The bill language was modeled after a piece of legislation enacted in Colorado in 2016. According to Perras, between its enactment and 2023, the program has seen over 24,000 students go through the pre-apprenticeship programs because of the funding provided.

In Stonington, Perras and HBRA are working with Butler to try to expand the high school’s offerings. Perras said the goal would be to crossmatch HBI’s apprenticeship program with an independent electrical contractor’s apprenticeship program, which would give program graduates a break in their first year of educational training.

“It’s an opportunity to bypass the first six months or year.” Perras said.

Butler stated that the district has been in conversations with Perras and Ackert to craft a legislative proposal that would “address several workforce pipeline issues in the trades.

“There have been informal discussions about the idea of including a pilot program to extend the current offerings at SHS as part of the legislative package. It would require funding and partnering with local tradespeople, but we are very interested in piloting a program similar to what is currently being implemented in Colorado.” Butler said.

The declining number of contractors due to work ratios may be a salient example of how occupational licensing laws can negatively impact the workforce, and of how difficult change is even in the face of an obvious problem, but that’s far from the only industry affected. Reforms that would make it easier to work and bolster Connecticut’s workforce are needed across the board, according to Davis.

“We need to take a holistic view to look at reform. Each individual trade has its own barriers.” Davis said.

“If we’re working to expand the workforce, which is desperately needed given job openings and a shrinking workforce, we really need to open up opportunities for people to enter trades and start businesses.” he added.

During the last legislative session, CBIA sponsored several pieces of legislation. One, which was successfully passed and became law, attempts to address the state’s teacher shortage by making it easier for would-be educators to obtain the certification needed to work. The bill, in part, reduced the number of levels of teacher certification from three to two, eliminating the provisional level of certification and extending the range of time an initial certificate is valid to ten years.

But other recent attempts at reform have been less successful. Early in the session, Gov. Ned Lamont proposed eliminating initial occupational licensing fees for certain education, childcare, and healthcare workers. The move was expected to save workers $3.5 million annually. The bill that would have eliminated the fees ultimately did not pass the legislature.

CBIA proposed a broader bill that called for all occupational licenses that fall under DCP’s oversight—which is the vast majority of licensing within the state—to be capped at $100 for annual registrations and $200 for biennial registrations. The bill received a great deal of public testimony in support but ultimately died on the House of Representatives’ consent calendar when the legislature adjourned sine die.

Looking ahead to potential reforms in the next legislative session, which will begin in January 2025, Davis said there are a “number of things” that need to be done. He suggested a similar bill capping licensing fees will be returning. “We also need to be taking a hard look at hiring ratios and their impact on small- and medium-sized businesses. At the end of the day, hiring ratios limit the workforce.” Davis said.

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