A city agency that was bludgeoned with layoffs during the housing and construction crash two years ago is beginning to hire again, in a possible sign of economic resurgence among the building trades.
Click on the photo at right to see more info on Department of Building Inspection permit revenue.
The Department of Building Inspection, which relies solely on permitting fees to fund its operation, is in the process of refilling most if not all of the 78 positions it shed between December 2008 and May 2009 after revenue suddenly plunged. In all, the department had to let go 30 percent of its staff, according to Director Vivian Day.
The rehiring means applications for building permits are up, with projects big and small under way. Department public affairs manager William Strawn said his agency relies on more-complex projects as its bread and butter, but an increase in smaller home-deck and kitchen projects is helping as well.
“In the office, we do have a fair amount of foot traffic,” Strawn said, adding that while there is an official hiring process in The City, the laid-off building inspectors and plan reviewers are generally given priority. “People here are looking forward to having some of their old colleagues back.”
Bigger projects bolstering activity in the department include work on the Transbay Transit Center and a new San Francisco Public Utilities Commission building on Golden Gate Avenue, Strawn said. Projections for the 2011-12 fiscal year are even better, partly based on expectations of permitting for the relocation of the Exploratorium museum and the massive proposed development for Treasure Island.
Revenue projections for 2011-12 are even good enough to potentially fund a new unit dedicated to training and inspections following earthquakes and other disasters, Day said.
Department revenue hit a recent low of $41 million in the 2008-09 fiscal year. But this year, it is on pace to hit $43.5 million, a 13 percent increase over the amount originally budgeted. And projected 2011-12 revenue has the department bringing in $48.4 million, the highest since at least 2006.
Strawn said the increased revenue could mean shorter waits for permits, which slowed down with the reduced staff. Robert Power, a building inspector working in the Mission district on Thursday, said he’s excited to have staff back on board. He escaped the massive layoffs and will enjoy more job security if the permit trends continue upward.
“I was one of the lucky ones,” Power said.
Staff Photographer Mike Koozmin contributed to this report.
Although The City’s rehiring of building inspectors laid off in 2008 and 2009 suggests the construction business is picking up, local contractors are still struggling three years after the housing bubble burst.
Manager Jean Marie Lescohier of San Francisco’s Clipper Construction once thought the recession would end in two to three years. But now, she’s not so optimistic.
“Right now, I don’t see things improving much,” she said. “There is a bit more interest in building than there was 12 months ago, but it’s still difficult because when you have a slow period, you can only weather it for so long.”
With her 41 years of industry experience, Lescohier doesn’t see business returning to the level it hit before 2008. Companies hoping to duplicate past profit levels will probably have to diversify, she said.
Other locally based construction companies also are feeling the bite of the recession.
“San Francisco has a real problem right now,” said MacGyver Construction owner Jay O’Neil, citing scaled-backed projects and outsourcing to out-of-town contractors. “It’s very hard to acquire the projects that we were used to getting.”
While the wealthy are still investing in home-improvement projects, O’Neil said, middle-class folks are scaling back and low-level projects have dried up completely.
But the 25-year construction veteran said he expects things to eventually get better.
“San Francisco is an interesting market,” O’Neil said. “There are no new areas to build, so you have to remodel. There is always going to be remodeling in San Francisco. But I don’t see it coming back very soon.” -- Alexis Terrazas