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In our latest episode about the ongoing labor and employment crisis, we sit down with Mischa Fisher—chief economist at Angi, the digital home-services marketplace—to discuss the current state of the skilled trades industry. Fisher’s latest research found that the industry, like many others, is experiencing a labor shortage, but it’s not due to the “great resignation.” Rather, Fisher explains, the stories we tell about the skilled trades do not generally reflect the abundance of opportunity and entrepreneurship that can be found within the industry.
The VOE Podcast is an extension of Voices of Experience, the signature speaker series at the University of Denver’s Daniels College of Business. Keep tuning in each month for more business insights from Daniels’ alumni voices of experience.
Transcript
Kristal Griffith:
Hello, and welcome to the VOE Podcast.
Jake Jensen:
An extension of Voices of Experience.
Amber D’Angelo:
The signature speaker series at the University of Denver’s Daniels College of Business.
Jake Jensen:
We’re your hosts.
Kristal Griffith:
Kristal Griffith.
Amber D’Angelo:
Amber D’Angelo.
Jake Jensen:
And I’m Jake Jensen from the Daniels Office of Communications and Marketing. We’ll be unpacking topics at the intersection of business and the public good with CEOs and other business leaders from the Daniels community. Let’s dive in.
Two of the dominant narratives that emerged during the COVID-19 pandemic revolved around the discussion of employment, or lack thereof, and the fact that so many of us were spending large amounts of time at home. Mischa Fisher examined both of these topics well before any of us were quarantined inside our living rooms.
As the chief economist at Angi, the digital home-services marketplace, Mischa evaluates the industry’s current climate, from consumer and stakeholder behaviors to prices and market size, then communicates those findings to a broader public audience. His latest research explores how the current labor and employment crisis is manifesting as an opportunity for growth and entrepreneurship in the skilled trades industry. Angi has partnered with Daniels on several projects over the years, and Mischa has been involved with student case competitions at Daniels as well.
Mischa, welcome to the VOE Podcast. We’re happy to have you here with us.
Mischa Fisher:
Thanks for having me. This is fun.
Jake Jensen:
Just to start, can you tell us a little bit about yourself and your professional journey to how you got to where you are now, and then maybe just a little bit about what you do at Angi?
Mischa Fisher:
Absolutely. I’m the chief economist at Angi, which people may know as Angie’s List or particularly for Denver-based listeners, HomeAdvisor, which were the two big brands that we rolled together. We’re now Angi, the home for everything home. We are a marketplace for home services in particular that can range from everything like seasonal maintenance upkeep, all the way to remodeling and getting your kitchen replaced.
On a business level, we run the full stack of what you can provide to the marketplace. That’s lead generation and providing that demand for pros. It’s also marketing and customer reviews, and then it’s also pre-booked or pre-priced services, so people can go in and actually book a job to be completed right from their phone, and we take care of the whole thing. That is the company.
As chief economist, my role is thinking specifically about what’s going on with the market, consumer behavior, pro behavior, which we’ll talk about, prices, the overall size of the market, is it growing, is it shrinking, what’s going on with the overall dynamics of what drives it. And then making sure we’re communicating those to the public industry, popular press, researchers, academics, that sort of thing.
And then in terms of a professional journey, before this I was the chief economist for the state of Illinois, which is the exact same title, but a very different role. In that role it was thinking much more about the policies of the state. I was the governor’s economic policy advisor, thinking specifically about labor force training, tax incentives, housing, professional licensing, all the things that try and make the state an efficient and productive place to start and grow businesses. It was a very different role despite the same title. In addition to those two things, I also moonlight as an applied statistics instructor at Northwestern University.
Jake Jensen:
Speaking of Angi, you recently authored a report for the company called “Skilled Trades in America: How the Great Resignation Could Provide Great Opportunity for Skilled Trades.” Can you just share a quick overview of the report? What did you research, how did you do it and what was the inspiration behind it all?
Mischa Fisher:
The broad overview of the report is we want to make sure people really understand what the skilled trades are. And we care specifically about the skilled home trades, so people doing the work building homes and servicing homes and improving homes, but that labor force is dynamic and fluid. People will sometimes be working on homes and new construction. Sometimes they’ll be doing remodeling work on existing homes. Other times they might be working on building commercial structures. And so it’s a flexible labor force, but one that’s not particularly well understood by anybody.
We’re trying to make sure that the trades are both A) afforded I think the respect that they deserve and part of that is coming from understanding, but B) also that people realize how beneficial it can be as a potential career. We see that job satisfaction in the skilled trades is tremendously high, and when we’ve got so much churn in the labor market right now with such low engagement in people’s regular careers, and then in the skilled trades such high engagement and such a high opportunity for economic payoff and good returns, there’s a real opportunity there. And so the report’s also trying to make sure that we prioritize getting that message out there.
Jake Jensen:
You were talking about how a lot of people in the skilled trades report exceptionally high job satisfaction, especially because they find meaning and value in their work. And your report also goes into the fact that there’s higher than average salaries in this industry. So given all these positive elements of working in this industry, why do you think there is a shortage happening?
Mischa Fisher:
I think there’s a shortage happening for a number of reasons. The first is, culturally, we haven’t put a priority on it. Culturally we’ve told people that you’re not a success unless you go to college. And college is really important. We’re sitting in one right now. It’s a great school. I teach at a different school. It’s also wonderful. And it can be a really important pathway for a lot of people, but it’s not the universal solution.
Not everybody’s going to love the work that they find themselves doing. For some people they’re going to find themselves happier and more economically well off by hopping into the trades the second they’re out of high school. And they can earn while they learn, they can really enjoy their work, and they can start a business and be entrepreneurs at a pretty young age. And we just haven’t told that story.
I think that’s the number one reason why there’s a shortage. The other reason is that we haven’t talked about some of these pieces of information. Most people don’t realize that it’s pretty easy for a plumber to clear 100K a year. On top of that there’s also some broader macroeconomic things that have gone on. For example, the housing industry took a big hit after the last recession. The last recession was an outlier. It was rare. It was a housing market recession and big home builders do a lot of training and recruitment into the industry.
So when home-building ground to a halt following that recession, I think we undertrained people to come into the industry and now we’re feeling the hangover from that 10 years later, where we spent a couple of years not bringing people in at the rate we needed to, and now that we’ve got all this booming demand, we’ve got demographics that are pushing people into home ownership and household formation. We’ve got a lot of home equity, which is fueling things like remodeling. We’ve got an explosion in home construction because interest rates dropped and people could afford it. And when you factor all that in there, there’s just not enough labor.
Jake Jensen:
The introduction of your report ends with this sentence, and I’m quoting here, “The adage that opportunity is missed by most people because it is dressed in overalls and looks like work has never been truer than it is in 2021.” What exactly did you mean by that?
Mischa Fisher:
What we mean by that is there is a tremendous amount of opportunity in the trades to grow a business and be happy and make yourself a lot of money and provide a valuable service to people. But because it’s not sitting in a coffee shop with a laptop, which I feel I can denigrate as somebody who spends a lot of time sitting in a coffee shop with a laptop, but because it doesn’t look like that, we don’t culturally right now think of that as being the entrepreneur.
Right now we think of the entrepreneur as somebody wearing fashionable jeans and some wool shoes and sitting in the coffee shop with their laptop. And we should also view entrepreneurship as just as likely to be somebody wearing work pants, work boots, and out in the field in a truck. They’re both entrepreneurs. We only tell the story of one of them though. And the latter one is dressed in overalls and looks like hard work, but there is a lot of opportunity there.
Jake Jensen:
The phrase “great resignation” is in the title of your report. What does the great resignation look like in the skilled trade industry?
Mischa Fisher:
In the skilled trade industry, there isn’t a lot of evidence that there is a great resignation. There’s a tight labor market and a lot of competition, but a lot of the quitting has gone on in white-collar work or it’s gone on in the service industries around hospitality and restaurants and that sort of thing. In the skilled trades, if you look at residential construction employment, it’s well above where it was before the pandemic. Overall, across the economy, we’re still… I think the latest numbers are about 7, 8 million jobs short of where we should be, so there’s 8 million jobs not there that were 18 months ago. We’re just net below that. We spend a lot of time thinking about the unemployment rate and labor force participation, but we know what the economy’s actually capable of producing in terms of employment, because demographics and technology and education haven’t changed that much in the last 18 months.
So we should be able to get back to where we were, but we haven’t, except for a small subset of industries, including residential construction. And in residential construction employment, which includes a lot of the skilled trades, we’re well above that. And that’s because the resignation is not really happening there. It’s a tight labor market, competition is real, salaries are way up, it’s a good time to enter and get a good working wage and enjoy what you’re doing.
As a result, all of those people who are quitting from other service industries, should be looking at this sector. And employers in this sector should be looking at those people quitting their restaurant jobs and saying, “I want to train these people up because they know service, they know communication, they know customer support. All I need to do is get them the skillset they need to do the work in the field,” or whatever the business happens to be. And that’s a big opportunity.
Jake Jensen:
What are some of the other key takeaways that you found in your research?
Mischa Fisher:
I think the next most important one besides job satisfaction is to think about diversity in the trades. People still recruit through word of mouth and because of the way that we tend to form social relationships, that can create an inertia in terms of who you’re pulling into the trades. And so the trades, for example, are overwhelmingly male. And if it’s a bunch of men in the industry asking around by word of mouth along their social network, which is also going to skew male, then you’re going to end up with an under-recruitment of women. And so that’s the big one—the trades are complaining about a trade labor shortage, but some of these trade categories are 98% male, which is very, very skewed.
And if you go back a couple of generations, law school and medical school used to be overwhelmingly male. Now the majority of grads out of both are women. And with the trades, there’s a similar opportunity to say hey, if we can quadruple the share of women working, it would still only be 10% of the labor force, which is still well under general population, but that could go a long way. And so getting the trades to think more about diversifying their recruitment methods and also diversifying their audience for recruitment is I think another big opportunity for the employers that figure that out.
Jake Jensen:
What are some ways that you think that business owners in the skilled trades industry can adapt to and overcome the current situation that the industry finds itself in?
Mischa Fisher:
They need to rethink, I think, compensation and ownership. I think things like equity are pretty common in the corporate sector, and it’s very common for tech workers to get a little piece of the company vesting on a regular schedule. I think that’s an area where the right company, and the economics of it and the financing is going to be different depending on your metro, your mix of business, where you are, the size of your company. But I think it is definitely worth it for more people in the trades to think about that. The idea that you can compete for talented labor the way you have 20 years ago is probably not right. The entire tech sector, as we know it, is brand new in the last 20 years. And it attracts a lot of smart people because the compensation is compelling and the trades have to figure that one out. I think that’s probably one of the biggest sources of opportunity for innovation in that, in that way.
Another thing that is something that we’ve already seen some adoption of are technological solutions. When you’ve got scarce labor, that’s when you start trying to innovate and come up with systems, machines, processes, technology, all of those things to try and save work hours in the day, to try and stretch the labor you have to go a little bit further. And so we’ve seen a lot of technology adoption among tradespeople. Off the top of my head, I think it was about eight out of ten adopted some form of technology solution over the course of the pandemic. A lot of it was digital payments, which we tend to think of as something that’s just less paperwork, but it’s also faster a lot of times. It’s faster in terms of it saves you time on accounting. It saves you time on calling people back. It saves all sorts of time, so there’s that.
But then we’ve also seen an adoption of technology around planning and putting people in the field and communicating with customers or potential customers. So there’s been a lot of technology adoption as well. And when you stack that on top of the general improvement in technology in the building trades, as we get houses that are more technologically advanced and more energy efficient and more durable, the trades has a real opportunity to rebrand itself as something that is on the cutting edge of both technology stack and in terms of building science.
Jake Jensen:
What is your vision of the future of the industry?
Mischa Fisher:
I think the future of the industry is going to be more professionalized. It’s going to be a departure from how the trades operated over the last 30 years. We went through a period where the trades were craftsmen and we really appreciated that they were masters of their art and their skill. You go back to European guilds around the shoemakers and the carpenters and whatever, leather workers, all those sorts of things. And then we went through a period of time when I think the stereotype of the plumber and butt crack was kind of the cultural impression. And if you talk to tradespeople who entered in the ’70s or ’80s, on average, you’re not going to get stories of professionalized recruitments and career planning and really mature business processes. It was more of a wild west of just people entered and they exited, and things weren’t that precise, and I think that’s all changing.
I think we’re hopefully going to revert both to a more professionalized, modern technology company-oriented world where they’re using more tools, they’re being more efficient, they’re being smarter, things are being built to last. But then we also revert back to appreciating the craftsmanship that goes into the work itself, appreciating the artistry in good trim carpentry, for example, or appreciating what goes into designing an elegant bath system, those sorts of things. I think that hopefully we should have both of those things on the horizon.
Jake Jensen:
You spoke at the kickoff event for Denver Startup Week and you mentioned that “business leaders and entrepreneurs should lead with talent,” was the quote I remember you saying. What does that mean? And how does that work in this industry currently?
Mischa Fisher:
If we look at what people want from recruits in this industry, they don’t say they want experience. They don’t say they want a pedigree. They don’t say they want somebody with a relationship to a friend. What they want is a willingness to learn and a good attitude. And I think there’s a broader lesson there, because some industries really care about pedigree and what school you went to and what company you used to work for. And I think when we care more about forming a more inclusive workforce, you should really focus on those other things, focus on a desire to learn and a good attitude.
These are things that a lot of us grew up with our parents saying that that’s what was going to work, and then a lot of people entered the labor force and found out that that’s not actually what people are looking for. And I think that we should live up to that and we should actually pursue people for the desire to learn and willingness to work and a good attitude and the potential, rather than just always relying on what the prior pedigree is.
Jake Jensen:
We here at the Daniels College of Business base our whole curriculum around ethical leadership and doing business for the public good. What does that mean to you in your own work, either in your current position or in the past or just overall?
Mischa Fisher:
I think I’ll speak generally on this one, but we all have to live here. We all live in a state community and the city of Denver locally, but then also in the state of Colorado and then the country of America, and of course on the planet Earth, and maybe Mars when Elon gets his rockets up. But it’s really important to recognize that and innovate in business, grow your market share, provide values to consumers. All of those things are critical.
Also recognize that you still live in the community and you want to give back to it. You want to be a positive member of it. And at some point you’re going to work your last day and you’re probably going to be more satisfied on that last day of work or on your death bed by having been a positive member of your community, rather than having helped your company gain an extra 2% market share.
Jake Jensen:
Is there anything you wish you would’ve known as a student that you know now in hindsight?
Mischa Fisher:
That is a really good question. I suppose it depends, because I did undergraduate and graduate school several years apart. And so there was different periods of ignorance at those stages. I think the more general advice is really making sure you own your own learning. It took me a couple years to figure that out, out of school, where I now make it a routine goal, both in terms of the technical stack, so knowledge of statistical methods, my programming skills, speaking skills, industry knowledge, company players, all of those things. I try and make it an intentional goal to make positive and measurable improvements across all those things in a given year.
And in my head, as a student and then as an early professional right out of school, it was, “I’m done with school now, now I just work and you progress in your career.” I didn’t think about it as an automatic thing, or I thought about it as an automatic thing. I didn’t think about it as something that requires intentional work. And if you can start that in school, you could get twice as much out of your university education as if you’re a passive participant in your classes and you are doing enough readings to not flunk any midterms, or enough technical work, whatever happens to be.
All of those things are fine, but you will get so much more out of it if you are really intentional about your learning journey and your first year out of school. Instead of saying, “I’m done learning now,” you say, “OK, now I’m going to start learning now that I’ve learned how to learn.” And that would be, I think, the biggest personal force multiplier for any listener.
Jake Jensen:
Great. Well, is there anything else that you want to mention or promote while you’re here that you’re working on? Any upcoming projects?
Mischa Fisher:
Yeah. I mean, if anybody’s curious about the economic research we’re putting out there, they can go check it out at angi.com/research. That’s A-N-G-I dot com. And of course, on a personal level, people can feel free to track me down on LinkedIn, where I’m relatively active. Always happy to have a conversation or be a sounding board for advice for anybody who’s looking for it.
And otherwise the work that DU does is absolutely awesome. We’ve collaborated in the past on some projects, which has always been fun. So just focus on your studies if you’re a student and if you’re a business owner, then hire lots of DU grads.
Jake Jensen:
Perfect. Well, thank you, Mischa, for being here. We appreciate it. And we’ll be in touch soon.
Mischa Fisher:
Absolutely. Thanks for having me. This was fun.
Kristal Griffith:
This has been the VOE Podcast.
Jake Jensen:
Produced by the Daniels College of Business and sponsored by US Bank.
Amber D’Angelo:
Music by Joshua Muetzel, music composition graduate student at the Lamont School of Music.
Kristal Griffith:
Join us next time for more business insights from our community.
Jake Jensen:
In the meantime, visit daniels.du.edu/voe-podcast.
Amber D’Angelo:
And please remember to like, follow, and subscribe wherever you get your podcasts.