May 2016, Vol. 71 No. 5
Features
Labor, Rates, Communication Highlight HDD Roundtable Discussion
The 2016 Horizontal Directional Drilling Roundtable, hosted by Underground Construction magazine in conjunction with the annual Underground Construction Technology International Conference & Exhibition (UCT), was held in Atlanta earlier this year and brought a spirited discussion about issues and opportunities of the HDD industry.
The 1.5-hour session was part of the unique, industry-leading UCT Educational Program and has become a popular part of the last several UCT conferences.
Drilling contractor panelists were Thomas Horn, owner, Directional Services Inc.; Robert Wall, president of Cable East; and Dan Carson, president of Carson Corp..
Moderators were Robert Carpenter, editor-in-chief of Underground Construction magazine, and Ron Halderman, P.E., director of HDD for the Mears Group, who kept discussions on target and moving forward. A large and interested audience mix of contractors, consulting engineers and owners provided input and asked questions.
Regarding HDD markets, it was agreed that telecommunications – driven by fiber deployment – is booming and expected to remain strong for the immediate future. The energy pipeline market has also been strong , but the effects of depressed oil prices are slowing that market dramatically.
Primary areas of discussion included:
- Low fees paid for HDD work and the effect on the quality of work;
- The need for improved communication among contractors, project owners and design engineers, and other stake holders; and
- The current and growing labor shortage in the HDD market and how to address it.
Low fees
With many project owners seeking HDD services at the lowest possible rate, panelists agreed the quality of work delivered suffers. Competing with low bidders who won’t do quality work is a constant struggle, said Dan Carson. Contractors who invest in good equipment and maintain it properly, pay their employees living wages and do quality work, simply can’t compete with low-ball companies. “It’s a constant struggle,” he said.
The question was asked: “Do project owners really value the quality of work?”
Panelists agreed contractors need to educate customers about what’s involved in a project to achieve quality and why quality work can cost more.
“First, contractors need to really evaluate the job and what it will take to do it properly. Then we better support the costs that go into our bids,” said Horn.
“Yes and then we have to educate those who only look at the bottom line of the potential risks,” said Wall.
“We can go to customers we have relationships with and say, ‘You simply can’t get the quality you want at these prices.’ It’s not cost effective to pay less to install a telecom system and then incur continuing costs to try to fix poorly done work,” Wall added.
Contractor risks
From fees, the discussion moved to economic risks encountered on projects and whether contractors are saddled with too many of the potential risks. Accepting that awarding bids on cost only carries the risk of poorly done work, panelists agree that often the contractors are responsible for a disproportionate amount of risk.
“We have to measure risk potential of a project so we know what we are dealing with,” said Carson. “That means when problems occur we need to evaluate their cause and whether it was our fault and then use what we learn. Risk assessment is very important. Cost and risk are connected.”
Labor shortage
Panelists and several in the audience agreed there is a serious labor shortage in the HDD industry.
The most frequently cited solution – train more people to be HDD operators and crew members. However, there’s more to it than that.
“Who is there to train? What is it about our business that makes it attractive to young people entering the job market? And for those who do hire on, why would they want to stay?” Wall asked. “There’s a lot going on today, and there are entry-level jobs that pay comparable or higher wages that might be perceived to be ‘easier’ than working construction on a directional drilling crew.”
Training within the company is one solution, but one comment was that it is difficult to get supervisory people to train younger workers who, they think, might be a threat to their jobs.
There’s also the perception – seemingly held by every generation – that young people today don’t want to work, and panelists agreed when young workers are hired, it is difficult to keep them.
How can jobs in the industry be made more attractive? Better wages and benefits could do it, but other issues under discussion seem to make that difficult to accomplish.
Summary
Halderman summed up the session which was highlighted by many audience comments and questions. “Discussions such as this one identify issues and provide an exchange of ideas of how to address them, but they need to include all industry stakeholders.
“HDD contractors need to capture data about the industry and work that will help arrive at conclusions. They need to participate in national and regional industry associations and organizations, and schedule more events like this one that includes project owners and engineers. We need to get everyone working together for the benefit of all,” Halderman observed.
Reflecting on the 2016 Roundtable, panelist Wall said he was very impressed.
“I definitely will be at the next UCT and in attendance at the HDD Round Table,” he said. “I’m concerned about the labor shortage and how we can attract young people to our industry. Perhaps the most important thing I came away with is the need for collaboration – getting owners, engineers and contractors on the same page.”
For more information about the 2017 HDD Round Table to be held in conjunction with UCT in Fort Worth, TX, be sure to check the UCT website beginning Sept. 1 for updates.
FOR MORE INFO:
www.uctonline.com
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