CHICAGO - In January, 2018, the Floor Covering Leadership Council (FCLC) commissioned an independent research firm to conduct a multi-phase study to quantify the scope and severity of the lack of installation professionals on the flooring industry's sustainability and growth. A Chicago-based research firm, The Blackstone Group Inc., was contracted to conduct the research, whose quantitative components focused on businesses that purchased workers' services by engaging floor covering installers as direct employees and/or subcontractors in 2017. A total of 334 executives, representing floor covering contractors, retailers, workrooms, and installation businesses across 45 of the 50 states, participated.

Part 2 of this 5 Part Series describes the make-up of today's installation workforce. Specifically, the research participants had three characteristics:

• The businesses that participated were predominantly floor covering contractors and retailers.
• Most of the respondents were CEOs, presidents, owners or held other high-level executive positions.
• The businesses' revenues from floor covering product sales and/or installation services ranged from under $25,000 to over $20 million. The median revenue was $2.2 million.
• Almost all of the businesses earned revenue from selling floor covering products directly to customers or clients in addition to providing installation services.
• The businesses' floor covering revenues were spread across construction sectors, with the single largest share (35%) coming from single-family remodeling and replacement.
• The revenue mix patterns showed the majority of businesses were more reliant on the residential market vs. the non-residential market and on remodeling/replacement vs. new construction.

The quantitative research's findings regarding participant's use of installation labor included these highlights:

• While most of the businesses directly employed installation workers, subcontracting was nearly universal.
• Two-thirds of the businesses had used both direct employees and sub-contracted labor in 2017.
• Compared to the contractors and the installers, the retailers were significantly more likely to have had no direct employees. Four in 10 were using sub-contracted labor exclusively.
• Participants were less inclined to employ non-U.S.-born workers directly than to rely on their subcontractors to provide them.
• Although direct employees and subcontracted workers both earned high marks for their performance, the employees' performance ratings topped the subs' on all measures except productivity.
• Businesses that had used both direct employees and subcontractors in 2017 were less inclined to boost their use of both types of workers in 2018 than to make trade-offs between them.
• Installation workers' 2017 performance influenced businesses' trade-offs. High employee quality ratings were associated with plans for hiring. High productivity was tied to more use of subcontracted labor.

The FCLC research initiative had several overarching objectives:

• Estimate the size of the gaps between the supply of and the demand for floor covering installers, now and in five to 10 years.
• Quantify the financial impact of the installer shortage up the supply chain.
• Identify key drivers of the installer shortage as well as potential solutions.

The study's findings suggest not only that the labor shortage is real, but that its financial impacts up the flooring supply chain are significantly greater than previously understood.

Associations included in the FCLC coalition and others donated the funds needed to accomplish the 2018 research. Ongoing industry fundraising will be coordinated to generate the funding needed for the initiative's future work.

Part 3 of this series will focus on the motivations and barriers of flooring installation as a career. Presentations detailing the FCLC research findings will take place on January 24, 2019 at The International Surface Event (TISE) in Las Vegas and on February 28 at Domotex USA in Atlanta.

About FCLC
The FCLC was established in 2015 as a coalition of flooring industry trade associations committed to identifying issue and developing solutions to the industry's most pressing challenges. Currently, twelve flooring associations support the FCLC including: American Floorcovering Alliance, Inc. (AFA), International Certified Flooring Installers Associations Inc. (CFI), Ceramic Tile Distributors Association (CTDA), Floor Covering Installation Contractors Association (FCICA), , Multilayer Flooring Association (MFA), Natural Stone Institute (NSI), North American Association of Floor Covering Distributors (NAFCD), North American Laminate Flooring Association (NALFA), National Institute of Certified Floorcoverings Inspectors (NICFI), National Tile Contractors Association (NTCA), Resilient Floor Covering Institute (RFCI), World Floor Covering Association (WFCA). For more information, visit www.fclccouncil.org.

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