Deferring maintenance drives costs beyond repair

Aug. 11, 2005
Are chronic backlogs of deferred maintenance reaching dollar values too high for companies to afford? Is the shortage of skilled workers driving costs beyond repair?

Are chronic backlogs of deferred maintenance reaching dollar values too high for companies to afford? Is the shortage of skilled workers driving costs beyond repair?

A company’s annual report never highlights what it would cost to get its neglected plants back into shape, but the sorry condition of the U.S. infrastructure is a matter of public knowledge. So are projections of future demand for people with the skills to fix both public and private assets.

Recent news headlines are full of reports like, “New Jersey bridges and roads are crisis…the state's DOT is facing a backlog of $12 billion in deferred maintenance,” “Massachusetts is slipping as an environmental leader … cutbacks have resulted in nearly $800 million in deferred park maintenance,” and “Across the U.S., bridges are $54 billion problem … California's transportation program is in crisis and on the verge of collapse.”

 With Baby Boomers retiring, what are we going to do? Are skilled workers more precious than gold?

Maybe so. In Australia, the cost of skilled workers, not lack of gold, was the key reason for closing the country’s second largest gold mine. Demand for skilled workers drove annual outlay per employee from $30,000 to more than $90,000. Calculations showed it was more cost-effective to close the mine. Is that what will happen in other markets unless we balance the exodus of baby-boomer retirees with an influx of skilled workers?

Back in 2000, then National Security Advisor Condoleeza Rice said, “There is a growing gap between the knowledge-based, technology-intensive jobs that are driving the U.S. economy and the skills of American workers. Education is the top national security issue of the 21st Century.”

While new law schools are being established all over the U.S. and existing universities generate record levels of attorneys each year, technical colleges and apprenticeship programs are in decline. “It’s going to get worse, then it’s going to get worse,” says Bob Williamson, president, Strategic Work Systems ( “Not only are the workers retiring, we are also not generating quality technical instructors.”

In the next eight years, 200,000 positions for industrial electricians are expected to open with starting salaries as high as $70,000 and 107,000 jobs for commercial plumbers/pipefitters at $56,000 to $95,000. Contractors can’t find enough skilled HVAC technicians; salaries could reach $80,000 plus benefits.

The price of neglecting your equipment or your technicians’ skills is on the rise. It may never be less expensive than it is right now to get your plant and maintenance workforce into shape.

E-mail Joel Leonard at [email protected].

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