Big C Lumber president addresses SMC ‘Saw Dust Day’
“There’s a chance for you to get in on the ground floor of what’s going to be an incredible run of new construction,” which Wallace attributed to a combination of a crippling recession/housing crash now almost a decade ago, pent-up demand and a labor shortage from millennials being slow to embrace such careers.
From 2006, “when we were arguably building too many houses,” to the depths of 2009, builds fell to 500,000 when 1.4 million starts are needed to keep pace with demand.
“Those years of 500,000 are 900,000 houses below where we need to be. They’re building apartments as quick as they can because they’re filling them as quick as they can. There are not a lot of rental properties” available. “The inventory of existing homes is the lowest in generations. Where I live in South Bend, a house goes on the market and is sold within weeks — usually over the asking price — because of the few options out there. This is one of the few businesses that can’t be outsourced, so there will always be opportunity. Interest rates are at 4 percent, but won’t stay down. The 5-percent unemployment rate is considered full employment. New immigration laws make it tougher to get into this country. People who left during the recession have not returned. There are so many openings available.”
This year’s wave of natural disasters exacerbated demand.
“Floods in Houston, fires out West, hurricanes down south, it’s been a horrible year,” Wallace said. “Every time something happens it creates need for remodeling and new construction, but this generation doesn’t think this is a sexy industry. A third of our company is over 55 years old in critical sales, executive team, manager, yard manager and driver positions. Our company is putting a huge focus on succession planning.”
To close the gap, Big C Lumber and others “hire for attitude. We can teach you the skills. We hired 20 summer interns. We’re networking in the community,” including Habitat for Humanity’s 35th Jimmy and Rosalynn Carter Work Project in Mishawaka/South Bend to build or improve 30 homes, similar to Benton Harbor in 2005.
Wallace’s career began with 84 Lumber, founded in 1956. It derives its name from the town of Eighty Four, Pa., south of Pittsburgh, although he started in 1984 as a manager trainee in Leesburg, Fla.
After six promotions and multiple moves, Wallace became vice president of operations for 260 stores in 28 states and more than $1.5 billion in sales.
After living out of a suitcase 14 of his 19 years with 84 Lumber, he pursued a position with the regional, family-owned Big C in Granger.
“I envy those of you who know what they want to be when they ‘grow up.’ I had absolutely no clue,” Wallace admitted. “In 1979 I was a high school senior in Hartford going to (Van Buren Vocational Technical Center in Lawrence). College was a great time in my life. I encourage everyone to go if you have the wherewithal.”
After marrying his high school sweetheart — now his wife of 34 years — and having a baby, the family moved to Florida.
He was 22 “and we were coming off a pretty bad recession in the housing market. Interest rates were 18 percent. Nobody could afford to build houses or buy cars. Issues in life are 95 percent how you deal with them.”
During Wallace’s two-decade tenure, 84 Lumber grew from 250 to 510 stores. He worked the counter, drove trucks, “whatever I had to do to get opportunities with that growing company. I’m not here to sell you on Big C Lumber, but on this industry. Today is way better than 1984.
“You’re building your own brand,” Wallace said. “Be careful what you post on the Internet. Whatever you put out there is forever. It’s the first thing we go to when we’re considering somebody for a job. We check you out on social media. We might pass on you if we find drama.”