BY Jack Criss
Executive Editor, Delta Business Journal

  It’s an accurate enough business cliche: As goes construction, so goes the economy. The number of new builds, the workloads of contractors and their subs, the amount of renovations—all of these variables can be used as fair gauges of a region’s economic progress, or stagnation. This is certainly true of the Mississippi Delta.
  Faced with an ongoing transformation from being primarily an agricultural player to a more varied and interconnected industrial one, the economy of the Delta is no doubt still feeling growing pains. But the key word in this equation is “growing.” As seen in the first ever Focus on the Construction industry in the Delta, the evidence is to be found that the region is indeed growing; this conclusion is based on the observations and experiences of the many construction leaders surveyed for this, the first of a two part series, “Building The Delta” exclusive.
  To be sure, the contractors who do the majority of their work in the Delta are experiencing their fair share of the “pain” that is part and parcel of the growth which they are witnessing. Yet all are proactively countering any negatives they find, and are aggressively preparing for ways to widen their scope of work, as well as increase their project load. This proactive stance is yet another showing of the resiliency that most businesses in the Delta have always displayed when faced with challenges or adversity.

THE PLAYERS
  Several well-known and longtime construction firms have built projects, or have them currently ongoing, in the Mississippi Delta. While not all are based in the region, most all surveyed have done a large portion of their work in the Delta and, in generally all instances, are pleased with the results.
  Roy Anderson Construction, founded in 1955, is a large, full-service construction firm based in Gulfport, MS, with divisional offices in Jackson, Memphis, and Dallas. Travis Rabren, Vice President and General Manager of the Jackson office, says that Roy Anderson specializes in “estimating, scheduling, project and program management, as well as construction management.”
The company averages approximately $300 million in project work a year.
  Carothers Construction, with its home office in Water Valley, MS, has spent 44 years in business. Working from “Massachusetts to Mississippi” as company president Sean Carothers puts it, this 250-employee firm is currently working projects in 6 states. “We do a good bit of military work,” Carothers says, “which takes us all over the country. At the present time, we are doing more negotiated military work, which means that we didn’t bid it; we negotiated the job with repeat federal government clients.” Carothers mentions that his company’s workload ration is about 35% private with the rest consisting of government jobs.
  JESCO Construction, a design build industrial contractor firm, does work in four other states besides Mississippi: Arkansas, Tennessee, Alabama and Kentucky. With corporate headquarters in Tupelo, MS, the 69-year old company has evolved into a full service firm which can act as general contractor, do mechanical work, and be an equipment moving and setting company.
According to Sid McMillan, Vice-President of Marketing for JESCO, the firm became even more competitive after being purchased by Mississippi’s Yates Construction in the first part of this year.
  Rozier Construction Company, located in Carrollton and owned by Mike Rozier, was started in 1976. The firm primarily specializes in commercial and industrial construction, with some agriculture related work thrown in the mix as well. The company also has a second office in Hattiesburg.
  Ridgeland is home to Pinnacle Construction, one of the newer companies on the construction scene, came into being in September, 1997, formed by President William D. “Don” Young. “I grew up in this industry, and had worked for many years as an executive in another large firm when I decided to open Pinnacle,” Young tells us. Success was not long in coming. In the
June, 1999 edition of Entrepreneur magazine’s annual Hot 100 Fastest Growing New Businesses survey, Pinnacle Construction came in 38, with 1998 sales of $8.97 million.
  “We do a lot of negotiated work,” Young explains. “Pinnacle can take a job from finding site selection, helping with the financing, putting together the architectural and engineering process; in other words, we can give a total ‘turn key’ job. We don’t do this all in-house, but we do have the capabilities to put together a team.”
  Clarksdale is the home office of White Construction Company, according to company Executive Vice-President, Guy White. Formed there in 1971, the firm now also has offices in Jackson, Austin, TX, and Auburn, AL. Because of its being based in the Delta, White says that the company does a majority of it’s work in the region.
  Malouf Construction, in business since 1987 and based in Gluckstadt, MS, opened a full-time office in the Delta, just south of Greenwood on the banks of the Yazoo River, in 1991. “This office was built primarily to handle heavy construction, Corps of Engineers work, and utility and marine projects in the area,” says George Malouf, company President. “However, we had to
expand the reaches of that office in order to handle industrial and building work as well.”
  Kenneth Thompson, Jr., owner of Kenneth Thompson Builder, started his company in Greenwood in 1984, primarily as a “home remodeling and building business,” Thompson says. Eventually, Thompson continues, he moved the company into commercial work which had “been our goal all the time.”
  Kenneth Thompson Builder, Inc., specializes in building schools, banks, hospital facilities, or, as Thompson succinctly puts it, “anything commercial, we can do.” The 23-employee firm’s owner is cautiously optimistic about the future, which we will see later.
  Mark Hooker Engineering, in business for 16 years this July 1, is based in Greenville. Neel-Schaffer, Inc., also an engineering and planning firm, has five statewide offices, the one in Tupelo serving the Delta, as will the sixth and latest office, opening in Southaven this summer. These engineering firms work with, and assist, the general contractors on projects by offering a wide range of services essential to its completion.
  These are the firms surveyed for this, the first part of Delta Business Journal’s special “Building The Delta” Focus. By no means exhaustive (more firms will be profiled in Part II of this Focus), the aforementioned listing of companies now discuss the work they are currently engaged in in the Delta.

THE PROJECTS
  Travis Rabren says that Roy Anderson Construction is experiencing an exceptional work load in the Delta: “There is still a boon in Tunica County, most particularly in Robinsonville,” Rabren says. Roy Anderson is also the general contractor for all construction on the impressive Greenville Higher Education Center. “This facility will open in the fall of this year,” Rabren tells us, “and classes will be held there by Delta State University, Mississippi Valley State University, and Mississippi Delta Community College.”
  Carothers Construction is also staying active in the Delta, according to Sean Carothers. “We built the Community Bank in Indianola on Highway 82,” he says, “and are acting as construction manager on many school programs in Greenville.” Carothers also names several renovation and expansion projects his firm has ongoing for South Fresh Farms of Indianola,
projects at Mississippi Valley State, and a recently completed $35 million prison in Tutwiler. Carothers also has done some $16 million worth of work at Parchman Penitentiary.
  Through their different divisions, JESCO Construction has been involved with work on Fishland Processors in Indianola, Delta Western in Indianola, and the Royal Vendors facility in Cleveland. This is in line with what Sid McMillan calls his company’s niche: “We are specializing in more and more industrial work, and we think we are quite efficient in this
due to the fact that we don’t have to subcontract out our various jobs on a project; we self-perform most of all it,” he says.
  Kenneth Thompson says his firm also has been involved in a myriad of Delta projects. “We did the construction of the baseball practice facility at Delta State, as well as the entrance to the college,” Thompson says. “We also did the Chamber of Commerce building in Greenwood, as well a huge testing lab for the state in Batesville.”
  Rozier Construction completed a $3.8 million expansion and renovation to J.D. George High School in Carrollton, MS, and also have a contract to build all Bill’s Dollar General Stores in the states of Mississippi and Louisiana. “This is a relationship we’ve had since March of 1998,” Rozier says, “and we are currently working on store number 57.”
  Rozier goes on to mention a $7.6 million Greenwood Middle School project, a $1.8 million expansion to the Oakhurst Middle School in Clarksdale, and construction on a new bank for Planters Bank and Trust in Greenwood. “We’ve also worked for years with Gresham Petroleum in Indianola, building 90% of the Double Quicks in the Delta,” Rozier adds. Also on the Rozier
Construction workload is the expansion of the National Picture Frames facility in Greenwood, as well as the Duo-Fast expansion in Cleveland.
  Don Young, of Pinnacle Construction, says that his company first entered the Delta in late ‘98 by building a 22,000 sq. ft. retail facility in Clarksdale called Clarksdale Commons. This trend continued in Cleveland with the subsequent building of the similar Cleveland Commons, a 25,000 sq. ft. facility. Young says other work is forthcoming that he is not currently at the liberty to reveal, but adds that “the Delta is on my list to stay in terms of future projects.”
  White Construction is busy in the Delta right now with the interior restoration job on the Coahoma County Courthouse, according to Guy White, as well as extensive work for Cooper Tire Rubber Company in Clarksdale. “We also just completed Phase One of the the Casino Factory Shops Outlet Mall in Robinsonville,” White says, adding that “we are just set to begin Phase Two.” White is also seeing a good bit of correctional work come to his company.
  “We undertook a design-build project for the Coahoma County Detention Center in Clarksdale,” White says, “and are construction managers on both the Tunica County Detention Center project as well as the Bolivar County Detention Center.”
  “Currently, we have a number of projects ongoing in the Delta,” says George Malouf, of Malouf Construction. “We’re expanding the Heartland Catfish Processing Plant in Itta Bena, constructing several medical clinics in Greenville, doing work on the Delta Center Industrial Training facility in Indianola, which is being sponsored by Mississippi Delta Community
College. Also, we’re about to commence work on the Hwy. 82 widening program right through downtown Greenville.” Overall, Malouf says, he is seeing more private dollars being invested in the region which he rightfully takes as a positive sign. “You certainly don’t want to count on the government to fuel the economy,” he states.
  Based on the above work projects mentioned by the firms surveyed for Part One of this focus, many of them major undertakings, it would seem that all is copacetic in the construction industry in the Mississippi Delta. Certainly, as just about all of the leaders in the field agree, times are good right now with new builds generally up and a steady stream of work
pouring through. As in any business, however, there are some areas that need addressing. Soon.

SO WHAT’S THE PROBLEM?
  Ask absolutely any member of the construction industry what is the greatest concern facing them right now and this is the answer you will receive: labor shortage. Work is available, and jobs are there, but the warm bodies with the necessary talent are not.
  According to national statistics, each year 250,000 new workers are needed in the construction field to meet the industry’s growing demand. The current average age of skilled workers in the industry is an astounding 55 years old. One doesn’t have to be a calculus expert to do the math on the statistic and figure out that there is indeed an issue to be
faced.
  Recent studies in the construction industry also show that more than three million skilled construction workers will have to be added to the United States workforce by 2003 in order to keep up with building demands. According to the Bureau of Labor Statistics, 65% of all jobs will require technical skills, and the industry leaders are saying that training levels have
been low for much too long over the last several years.
  “The problem has become an epidemic,” says Sid McMillan of JESCO. “It it always, and I mean always, a major challenge for any of us in the business to properly staff a project.” George Malouf concurs: “Today, the single biggest problem in our industry is a qualified work force, and it’s nobody’s fault but our own,” he honestly claims.
  “I would hire three of four new full-time men now,” Mike Rozier tells us, “but I just can’t find them.” Rozier not only bemoans the dearth of skilled workers, but also the work ethic, or lack thereof, of those qualified who can possibly be found.
  “In my opinion, many of the young people out in the workforce today aren’t as willing to get out and work extremely hard,” Rozier states matter-of-factly. Kenneth Thompson sees eye to eye with Rozier on this issue.
  “The younger folks in the workforce today don’t consider construction work high profile, or glamorous enough, I suppose,” Thompson says. “I call it a ‘khaki’ or ‘blue jeans’ job, which is not to say you can’t make a good living at it. But you have to work extremely hard to make it, and you have to have initiative.” As an example, Thompson recalls his own climb up the
construction ladder. “I started out digging ditches and just worked my way up to owning my own business. But I knew at the beginning that there was something bigger ahead, and I made up my mind to learn the trade and make it.” “A lot of these young people simply don’t want to get their hands dirty and work their way up from a starting position,” echoes Mark Hooker.
  Don Young, of Pinnacle, also has seen a shift for the worse in the attitudes of the young employees. “The work ethic has changed drastically,” Young worries. “I think that a lot of these kids just were not taught any responsibility or pride for a job well done when they were growing up. With the economy as good as it has been over the last several years, getting
a job is not as hard as it once was. Consequently, the young people who really want to work hard are few and far between these days. And let’s face it: the construction industry is a tough way to make a living. But ultimately, it’s worth the struggle. That mentality seems to be lost on a lot of the young folks out there today.”
  Major efforts are underway, all initiated from within the construction industry itself, to rectify the problems of labor shortages and finding skilled labor, which will be touched on shortly. While none of the executives profiled would go so far as to call the labor situation a crisis just yet, all were extremely concerned and said that immediate action was needed to
prevent a possible disaster down the road.
  While the cyclical nature of the construction industry is a given to those in the business, and not as serious an issue as that of labor shortage, this characteristic still keeps the firms surveyed very cost-conscious and careful not to enjoy the boon times too much. Thus, watching the bottom line and not over-extending when things are going well is critical to all
in the industry.
  So, what is being done to lessen the concerns of all of those in the industry about the problems of labor shortage, as well as other concerns they may face? Organizations that exist in the state are helping find solutions.
 

INDUSTRY PRO ACTIVITY IS KEY
or TEACH IT, AND THEY WILL COME
  The Mississippi Construction/Education Foundation (MCEF) was formed in July, 1996 with the express purpose of educating young people in the fields of construction and promoting job opportunities within it. During the initial year of its existence, pilot programs developed by MCEF were established in Hinds, Rankin, Madison, and Warren Counties. In the summer of
1998, 36 students qualified and were accepted for work in the industry, and 26 worked the entire summer. According to George Malouf, current chairperson of the MCEF, this recent school year saw a whopping 3,000-plus students in this program.
  What exactly do these programs offer? And why the incredible surge in enrollment? Dudley Mitchell, Executive Director of the non-profit MCEF for the past year and a half, explains: “We find students who feel they might be interested in entering the construction industry by going into the various high schools and speaking to them. To qualify, an interested student
must be 16 years of age, and pass all six modules of our specially-created ‘Wheels of Learning’ core learning program. The student must attain at least 80% on the math module and at least 70% on Safety, Introduction to Hand Tools, Introduction to Power Tools, Blueprint Reading and the Rigging module.”
  This innovative, and obviously effective, means of bringing young people into the construction industry had it’s origin in 1998 when members of the Mississippi AGC (Association of General Contractors), ABC (Association of Building Contractors) and the Mississippi/Louisiana Brick Association put  up $75,000 in seed money as a funding gift in order to hire staff. Seeing the real plight of labor shortage, the need for an educational organization was seen, by those within the industry, as the best way to head the growing problem off. When the seed money started to run out, the industry came together in a unique
way in order to continue to fund the MCEF.
  “The heads of our industry went to the State Legislature two years ago and did something quite remarkable,” recalls Mitchell. “They said to them ‘Tax us.’  They wanted the State to add a $100 tax increase to their annual licensing fee in order to specifically earmark funds for the MCEF.” This was approved, and all concerned are excited about the growth of the
program and the potentials ahead for the prospect of new, young, well-qualified workers.
  Additionally, the Mississippi State Department of Education had become involved with the MCEF, partnering with the organization to get their message into as many of the state’s high schools as possible. The Department also allowed the MCEF to assume control and operation of the Adult Math Training Program and apprenticeship programs offered throughout the state, and helps MCEF maintain a training process that insures that apprentices and/or trainees receive
a quality education.
  According to Mitchell, the curriculum used by the MCEF is developed and provided to them by the National Center for Construction Education and Research (NCCER) out of Gainesville, FL, the only nationally-accepted curriculum developed for construction trade schools in the U.S. “This curriculum was designed specifically by contractors for the education of potential
construction workers, “ Mitchell states.
  Kris Merriman, the Assistant Executive Director of the MCEF, travels the Central Mississippi and Delta regions, going into schools to spread the message of what the construction industry offers, and she is pleased with the response she has received,
  “I spent last September in the Delta,” Merriman says, “speaking at Humphreys County Vocational School in Belzoni, South Delta Vocational School in Rolling Fork, Greenville Vocational School, and Joe Barnes Vocational School in Rosedale. The response was extremely good. In Belzoni, for example, 11 students qualified to work as summer interns, and were very
enthusiastic about it. This, after I was told by an instructor there that the kids had no interest in construction at all!”
  Merriman says her job is very gratifying and that the industry is at long last promoting itself because of the work she is doing. “I love seeing the changes in the students after they work with the companies during the summer,” she enthuses. “They’re more focused, have better attitudes, and are obviously excited about the work they’ve done.” Roy Anderson, Malouf, and Upchurch Plumbing are among the many firms that hosted summer student employees in 1999.
  All surveyed for this Focus applaud and support the efforts of the MCEF, and many are very active within the organization and have already seen results from its work. But most also realize that a short-term payoff is probably not forthcoming. Says Sean Carothers: “I’m extremely optimistic about the steps that have been taken to recruit and train young people. But, I also realize that these efforts will have more of a long-term yield and that we are all still going to have to be patient.” His sentiments were echoed by all of the other construction principals.
  Another organization dedicated to helping the construction industry in Mississippi is the CompTrustAGC of Mississippi, a self-funded worker’s compensation insurance plan for general contractors and subcontractors in the state based in Gulfport. CompTrustAGC, started in 1991, is a voluntary association with approximately 200 members statewide. A construction company must be a member of the AGC before CompTrustAGC can undertake the worker’s comp coverage for
that company. The advantages of membership are many, according to Bill McGowan, Plan Administrator for CompTrustAGC.
  “We compute what our member’s premiums will be by what they specialize in and how many employees they have,” McGowan explains. “Annually, we issue a policy to cover the firm’s liability and exposure in their particular class of work for that particular payroll. At the end of the year, after we pay our claims, costs for any injuries to employees, and
administrative expenses, we compute a dividend that then goes back to each of our members. This dividend is approved by the Mississippi Workers Commission and is subsequently sent back to the members.”
  The main advantage to membership in the CompTrustAGC of Mississippi, McGowan informs us, is the advantage to the all-important bottom line. “We all work together as a team to reduce injuries and accidents out in the field and the costs that are involved with them. So far, we have been very successful in bringing our injury numbers down and that, of course, helps
bring premiums down.” McGowan has spent many a day out on job sites since he assumed his job in November of last year to insure that safety levels are high.
  McGowan says that another recent project CompTrustAGC of Mississippi has underwritten will also help the construction industry greatly. The Jack Thompson Memorial Scholarship, named after the founder of CompTrustAGC, has been provided to the University of Southern Mississippi’s Construction Technology Department. “This is a very important and impressive
program that we are proud to sponsor,” McGowan says. “Three students attended USM on the scholarship this year, and that number will undoubtedly go up.”
  So while problems do exist in the construction industry, as in any other, it would appear that the leaders of the industry are taking very decisive and concrete steps to rectify these problems and, at the same time, improve their profession dramatically. The level of cooperation and interaction among the construction firms surveyed is very impressive, and demonstrates a commitment to camaraderie that is rare in the business world. Such cooperation bodes well for the future of the construction industry and its ability to overcome any and all internal problems.

ENGINEERING SUPPORT FOR DELTA
CONTRACTORS
  Of course, much Delta industrial work cannot be done alone. This is where engineering firms enter the picture, assisting the contractors and putting the finishing touches on the project.
  In most cases, the owner contacts the engineer for design work and, from there, the engineer prepares plans and specifications, contract documents, and so forth. Then the engineering firm helps the owner negotiate a price, or contract, with a construction firm to build the facilities that are needed.
  Neel-Schaffer’s Greg Davis, Engineer Manager for the North Mississippi region out of the firm’s Tupelo office, says that his company has done substantial work for the casino industry in Tunica county, and is currently back in Tunica working on the soon-to-be-constructed Tunica County Airport, which is being built for the facilitation of casino business.
  “We’ve done preliminary work over the past couple of years on this project,” Davis says, “and there’s still a considerable amount of permitting yet to be done, as well as environmental work which is mandatory with building an airport. We’re currently in the design stage,” Davis adds. Completion on the project is expected in approximately two years, with a site
preparation contract scheduled to be negotiated in the early fall.
  “We also do a lot of landfill work and other airport work in the region,” Davis says. “We did the permitting and the preliminary design work on the Tunica landfill. Our bread and butter work is utilities, water, and sewer projects. In fact, we’re currently engaged in a sewer extension project for the city of Hernando.”
  Mark Hooker, of Mark Hooker Engineering, says he believes, based on the evidence he has seen, that the next couple of years are going to be good ones for the Mississippi Delta.
  “There’s still a lot of work coming out of the public sector with roads, bridges, water and sewer projects,” Hooker says, “although the Highway Department work has slowed because of a lack of funds. I think, however, that the legislature will reappropriate for that work in due time, possibly in the next session.”
  Currently, Hooker says his company is waiting on getting the go-ahead to do a prominent sewer project in the region, and several bridges are in the preliminary design phases for Washington County. Hooker also tells us that the firm is undertaking a paving project in Rolling Fork, a $110,000 paving project in Issaquena County, and a bridge under contract to
be constructed in Sharkey County.

A NEW DAWN FOR DELTA CONSTRUCTION?
  “Opportunities are wide open for contractors in the Delta right now,” says Mark Hooker. It’s a point that many others in the construction field are making.
  “I’m seeing more new construction here than I have in the past twenty years,” says Harvey Green, Senior Vice-President for White Construction. “This is the case in both the commercial and residential sides, and it’s very, very promising.”
  The consensus seems to be that the Delta construction community can roll with any punches and come out smelling like the proverbial rose. Like all other Delta businesses, the key to survival is patience, excellent service, and, in many cases, plain old-fashioned pride in a job well done.
  “Good things are happening now in the Delta,” says George Malouf. “Sure, we’ve had some major pullouts in the manufacturing sector over the past few years, but none have decimated our community. There have been hardships, without a doubt, and there will continue to be. But everybody here is working together, putting their best foot forward to improve employment opportunities, and it is starting to pay off.”
  Malouf is not just being a cheerleader. While the exact numbers are difficult to ascertain, construction companies in the Delta are staying in business, and this is the simplest gauge of success.
  Sean Carothers assesses the situation in the following way: “Historically, of course, the Delta has been an agriculture-based economy. Traditionally, there has been a deficit of manufacturing bases here. However, this will change, and the change will be driven by the labor market and by the ‘New Economy’, which will require and necessitate additional employees. New industry will no doubt come into the Delta and seek out workers, which will result in growth.”
  “This year is going to end up being yet another strong one for construction in the Delta,” Kenneth Thompson says. “We know that this pace can’t last forever, though. If you’re a good contractor, you stay honest, and if you make your customers happy, you’re still going to get some jobs, even in the down times. A good reputation has gotten us plenty of work in the
past, as I’m sure it has other firms.”
  And even with the market tightening, as it has recently due to the softening bond market and soft bank market, this just makes a company work that much harder, according to Mike Rozier. “You have to turn over every stone to find the work that’s out there, and be more aggressive,” he says. That raises the bar of competition and makes all of us stronger.” As Sid McMillan puts it, “Contractors tend to be like gypsies: We have to follow the work!”
  Occasionally, outdated - yet still persistent - stereotypes about the Delta enter into a contractor obtaining work, especially from out-of-state concerns. McMillan relates a story about a Wisconsin owner who had doubts about a Mississippi Delta firm being able to do the work he desired. “I quickly answered his doubts by pointing specifically to projects JESCO, and other firms, had completed,” McMillan says. “But, unfortunately, that type of prejudice still exists, even today. However, as I tell everyone, our professionals are as good as, if not better than, others across the country.”
  “The Delta has a great deal of potential, especially in the retail sector,” says Don Young. “We’ve recently seen several new retail build-ups from stores and companies that had never had a presence here before.The workload is certainly getting tighter; but those of us in the industry have to sharpen our approach and bring more to the table, and at a better price,
than the competition.”
  To a number, all of the professionals surveyed in this Focus were pleased to work in the Delta, and not just for purely business reasons. Several, such as Guy White and George Malouf, are originally from the Delta, and several others, like Mike Rozier, Mark Hooker, and Kenneth Thompson still call the region home. Comments from “a safe place to live” to “a
terrific place to raise a family” were sprinkled throughout the interviews.
  It is increasingly apparent, in today’s world, that values still play a huge role in business decisions, choices, and practices. The fact that the Mississippi Delta embodies so many of the cardinal values, along with a commitment to excellence and outstanding service, would seem to point to a bright future, not only for contractors in the Delta, but for all other businesses that call this region home as well.

(Part II of Delta Business Journal’s “Building The Delta” Focus will be featured in our
upcoming July, 2000 issue. In it, additional interviews will be featured and other issues
will be explored. For information, contact Executive Editor, Jack Criss, at 662-843-2700.)