Oregon’s Economic and Construction Outlook

Josh Lehner, Senior Economist, Oregon Office of Economic Analysis

The CSI Willamette Valley Chapter originally intended its January meeting to feature a forecast of the Lane County economy and construction outlook for 2019. That meeting will still occur, but the chapter leadership postponed it until February 27, by which time this year’s economic trends may already be well-established. In lieu of the customary January meeting, CSI-WVC organized a lunch presentation this past week by Josh Lehner, Senior Economist with the State of Oregon’s Office of Economic Analysis. 

I joined approximately fifteen others at Poppi’s Anatolia Restaurant in downtown Eugene to hear from Josh. He is an excellent speaker, amply demonstrating his comprehensive knowledge about factors in position to impact prospects for the local construction industry. These range from the macro-level down to dynamics very much specific to the Eugene-Springfield economy. 

Josh began by stating what has been clearly evident, which is that economic growth has been robust across the country for the past decade (the 10-year expansion of the national economy is a U.S. record). Increases in workers’ wages have been especially strong in Oregon during that period, averaging between 3 and 4 percent per year. Lane County employment has rebounded since its pre-Great Recession (before 2008) peak to the point where all industries are now at historic highs (the outlier is manufacturing, which witnessed a 40% drop in its numbers, from which it has yet to recover). The architecture and engineering fields now number some 15,000 employees statewide, with an average annual salary of $80,000. 

Not surprisingly, Oregon’s population expansion has matched that of its economy. Salem leads the state’s metropolitan statistical areas in terms of population growth. Here in Lane County, the majority of newcomers have settled in Eugene, with far fewer choosing to locate in Springfield for some reason. 

A direct consequence of the strong local economy is a housing affordability crisis, with the number of new housing units being built falling short of demand, driving up prices. Exacerbating the problem is how tight bank lending has been since the Great Recession. Additionally, the urban growth boundaries around the perimeters of each of the state’s cities and metropolitan areas control urban expansion onto farm and forest lands but also limit the supply available for new homebuilding. The residential construction sector has thus struggled to keep pace with the level of need. 

Josh pointed to several factors at the federal level that may influence how Lane County’s economy plays out in 2019. There is a troubling level of bad debt on the corporate side. Equally concerning may be the Federal Reserve’s shifts on monetary policy, and the Administration’s views on trade and taxes. On the flip side, the exponential growth of national debt and trade imbalances have yet to prove a barrier to growth. The direct impact of the recently imposed tariffs on trade has likewise been minimal, only amounting to 0.2% of Oregon’s GDP. The recent, record-breaking government shutdown began to impact the national economy but is now in abeyance. 

Generally, the economic outlook for 2019 remains rosy, though prospects for 2020 appear less so as economists predict recession-related risks will be elevated by then.

So, what do the latest local statistics say? Josh reported the rate of growth does appear to be lessening, and with it the pace of Oregon’s population growth. Domestic in-migration has been a prime driver of the state’s economy in recent years, so a decline in new residents may augur a possible economic slowdown in Lane County; however, this doesn’t mean a retraction is in order, simply that growth is tempering. A reason why further expansion is unlikely is the tight labor market, in which demand by employers exceeds the available supply of workers. This problem is particularly pronounced in the construction industry as shortages of laborers and skilled tradespeople are widespread. Current forecasts do predict levels of employment in Oregon’s construction-related industries will remain on the plus side for several years. 

I’m no economist but it seems to me a major consideration that isn’t being factored into the analyses by Oregon’s Office of Economic Analysis and others is the existential threat to all of humanity posed by anthropogenic global warming. Perhaps this is attributable to how unprecedented the threat is. Without a doubt, the worldwide impacts are becoming increasingly significant and hard to ignore. These impacts will only intensify and have an effect on everyone, including all of us here in Lane County. The pessimist in me says our planet has already passed a tipping point toward an unavoidably apocalyptic fate. Our chickens are coming home to roost, and with them will come massive economic upheavals. In my mind, it’s not a matter of “if,” only a question about “when” everyone will begin to see these effects. 

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Is it curious the chapter chose to conduct both a January lunch meeting and February’s coming chapter meeting on the same topic? Yes, though I believe February’s session may include a panel of economists offering a broad range of perspectives. That said, February’s speakers will be hard-pressed to outdo Josh’s first-rate synopsis of his office’s analyses and predictions for 2019. Big thanks to Josh for sharing his time with us.

A New Value Base

Photo by Ian Mackey on Unsplash

The following excerpt from Bill Kleinsasser’s rambling, 1981 edition of his self-published textbook Synthesis is a lament that remains as timely now as it was when it was first written. Fundamentally, Bill espoused a humanist approach to designing our built environment, one grounded upon how we experience, identify, and interpret our surroundings. He promoted learning from history, embracing common sense, and designing places first and foremost for people. What concerned him was seeing architects instead too often surrender to financial exigency, flounder with cultural illiteracy, lean upon the crutch of technology, and generally ignore the creation of supportive settings.

As I’ve said before, I’m compelled to feature Bill’s writings here on my blog because his legacy is otherwise non-existent online and risks being lost to time. The audience for Synthesis was essentially limited to his immediate students. An increasing number of us are moving toward the back half of our careers or are already retired, so the opportunities to directly apply the principles he espoused in our work are dwindling. My hope is by publishing his words here that some among the newer generations of designers will also come to appreciate the value base he embraced.

A New Value Base

For many years an unbalanced and limited value base has caused environmental development to be less than satisfactory: often unsupportive, constraining, and rigid. Several prevailing practices have been the instruments of this:

• The man-made environment is usually developed in large chunks and discontinuously, both in time and space, as if each place had to be auspicious and autonomous or, at least, as if each had to be done all at once and once and for all. This practice has caused tremendous, often fatal, impact on what exists, and has spawned the habit of not developing the spaces with the greatest experiential potential—those between buildings. The meaning that can be provided by the undesignated, relatively open character of these spaces is very great and there is no doubt that they have contributed much, not only to the experiential richness of many cities (especially some European cities), but to the places at other, smaller scales as well.
• Economic and technological considerations often dominate the design of the environment instead of facilitating humane development. The experiential character of places is determined by land-value formulae, technical convenience, codes, and arbitrary budgets instead of by the careful, thoughtful consideration of the experiential supports and opportunities that will be needed as time passes and as circumstances change. 
• Very often the eventual users of the environment are not consulted about its design, causing immediate personal and group misfits. 
• Very often available patterns which explain the success or failure of places are not used. 
• Very often the environment is designed for the first purpose and first users only, causing very rapid obsolescence. 
• Very often users who must or wish to stay in places have no way of adjusting, personalizing, or otherwise effecting change to those places. This not only renders the places difficult to possess, but causes them to be, to a degree, out of control. 
• Very often some form of management dictates too much regarding the use of the environment, thereby spoiling potential supportiveness. Consequently, the spaces that people get to live in have many problems:
1. Missing facilities . . . they just aren’t there.
2. Inaccessibility caused by inappropriate relationships among facilities and places of habitation.
3. Misfits caused by sameness or rigidity. Life circumstances of people are often very different; therefore life spaces mush also be different . . . and they must change as people change.
4. Misfits caused by change . . . peoples’ surrounding are often ruined as far as they are concerned, and no one knows.
5. Unsupportiveness caused by inappropriate spatial character.

We need better methods of programming and designing the environment, especially the shared, public environment.

WK / 1981

2019 Block Kids Competition

The Eugene chapter of the National Association of Women in Construction (NAWIC) invites all grade school-aged children (1^st through 6^th grade) to take part in the 2019 Block Kids Competition.

Block Kids is a nationally-recognized, award-winning building competition for children in Grades 1 through 6. The event introduces children to careers in the construction industry and encourages them to use their imagination to create a structure with a specific set of materials. It also allows children to explore how and why a structure is built.

How it works: Each participating child receives 100 interlocking blocks and a choice of up to three additional building materials (foil, poster board, rock, or string). The child builds a project of his/her choice, provided it relates in some way to the construction industry. (Construction equipment is acceptable; depictions of people and animals are not.) Local construction industry professionals will judge each entry. Competitors will discuss their projects with the judges. Judges will consider the projects and their discussions when awarding prizes. They will select first, second, and third place winners from three grade-level groups (Grades 1-2, Grades 3-4, Grades 5-6). One overall winner will be chosen to compete at the regional level. All participants receive a goody bag.

Block Kids is co-sponsored by the Eugene Science Center, National Association of Women in Construction, and River Road Park & Recreation District.

Advance registration for Block Kids 2019 is now open.

• Free to participate for kids in grades 1 – 6!
• Advance registration is required! Fill out the online registration form.
• Check-in for registered participants begins at 12:30 PM at River Road Park & Recreation District (Emerald Park), 1400 Lake Drive.
• Participants must be checked in no later than 1:15 PM! Latecomers may forfeit their spot.
• Competition begins at 1:30 PM.

Register early, space is limited!

Dan Herbert, AIA (1927 – 2019)

Dan Herbert, AIA (1927-2019)

Eugene architect Dan Herbert, AIA, passed away on New Year’s Day at the age of ninety-one. Dan was highly-regarded as both an educator and a practitioner, and as his obituary below attests, he made his mark on many fronts. Without a doubt, he was one of our local profession’s most respected elder statesmen. I will always remember Dan first and foremost as being as kind and thoughtful a person you could ever hope to know.

I never experienced the privilege of taking a studio or class taught by Dan during my days as a student at the University of Oregon. If my memory serves me correctly, he did review several of my studio projects, including my design for an expansion of the McMinnville Public Library. Dan’s firm, Herbert and Keller, had recently designed the real-life project for the Library, so I certainly received the most qualified critique possible.

It wasn’t until I returned to Eugene in 1988 that I really got to know Dan better. He regularly attended AIA-Southwestern Oregon chapter meetings. Though soft-spoken, he enjoyed the company of his fellow architects. At those meetings, he and I would often talk about local developments, evidence of his ongoing professional engagement following retirement from full-time professional practice. He will certainly be missed by his professional colleagues.

McMinnville Library Addition (1982) by Herbert and Keller Architects (photo by M.O. Stevens [CC BY-SA 4.0 (https://creativecommons.org/licenses/by-sa/4.0)], from Wikimedia Commons)

Here is Dan’s obituary, as published on January 13 by the The Register-Guard:

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Daniel Martin Herbert died suddenly at home at Cascade Manor as he rose to greet the New Year. He had been on hospice since October for congestive heart failure.

Dan was born in Chicago to Litta and Benjamin Herbert on July 15, 1927. His father died of a heart attack when Dan was five years old. He started working part-time at age eleven to supplement family income. Dan joined the navy in 1945 and consequently was able to attend college through the GI Bill. He graduated with a B.F.A from the University of Colorado in 1951, where he studied fine arts and mechanical engineering, and graduated from the University of Illinois with highest honors in 1954, earning a B.S. in Architectural Engineering.

Dan met Eleanor McCullough in 1949 at the University of Colorado. They were married in 1953. They celebrated their 65th wedding anniversary in 2018. In 1954, they drove to Portland, Oregon to start work, Dan as an architect and Eleanor as a teacher. They moved to Eugene in 1954, where they worked and raised three children, Nan, Lauren, and James.

Dan worked in solo architectural practice or in partnership from 1958 to 1984, designing more than a hundred commercial and residential projects. He served as an adjunct professor at the University of Oregon School of Architecture, teaching design studios, computer-aided design, and advanced graphics. He wrote many articles for architectural journals and a book on graphic thinking in design. He received grants for his work from the National Endowment for the Arts and through the University of Oregon Office of Research and Sponsored Programs.

South Park Building (1975) by Herbert and Keller Architects (my photo)

Dan was also active in community affairs as a member and then president of the Lane Transit District Board, and as a member of the Eugene Renewal Advisory committee.

Much of Dan's professional and volunteer work focused on sustainability and environmentally responsible construction, city planning, and transportation. He also promoted living responsibly as an individual and as a family. Until his first heart attack at the age of 54, he commuted by bicycle. His children and grandchildren continue these traditions.

Dan had lifelong interests in reading, language, science, art, and construction. He continued his community engagement until the day before he died, leading reading group discussions, working on an exhibition of his most important architectural designs, and redesigning an entrance for his retirement community.

Dan modeled hard work, community service, and delight in the world. Eleanor, children Nan, Lauren and Jim, and grandchildren Philip, Kate, Forrest, Maia, Nicole, and Pauline have each been inspired by his life, and will carry forward his spirit and dedication.

Donations in his name can be made to The Brown Energy Studies in Buildings Laboratory Fund, University of Oregon Foundation, or to the Cascade Manor Foundation. An exhibit of his most important drawings are currently on display at Cascade Manor. A celebration of his life will be held in the spring.

AIA Oregon Eugene

As Frank Visconti, AIA noted in his end of year message on the aiaswo.org website, last week’s turning of the calendar heralded big changes for members of AIA-Southwestern Oregon. The results of last summer’s State Chapter Initiative election indicated overwhelming support among the entire AIA Oregon membership—AIA-SWO members included—to unite the state’s four separate chapters into a single statewide body. Among other things, this means “AIA-Southwestern Oregon” formally ceases to exist, instead becoming one of five AIA Oregon chapter “sections.” Officially, those of us who were AIA-SWO chapter members are now assigned as members of AIA Oregon, with voluntary membership in either the AIA Oregon Eugene or AIA Oregon Bend local sections. 

For those who haven’t yet seen it, here is Frank’s entire message: 

2019 will mark a unique milestone of the 66-year history of this thriving and exemplary chapter. Starting January, we will all be united as AIA Oregon chapter members. AIA Oregon will be a single 501(c)(6) and allow our chapter to shed its bureaucratic structure. Without the burden of the unnecessary and redundant corporate template, we can focus more directly on our members and programs. Our membership dues will no longer include local chapter fees and we won't have to use Robert's Rules of Order! We will continue our weekly e-newsletter (T@3), monthly presentations and events, design awards, People's Choice awards, continuing education programs, Design Spring, and CoLA. 

I will continue in my leadership role for another year as a director representing the Eugene Section of the Oregon AIA. Our current board members will continue to help put together all our current programs and we will continue to meet twice a month at the Octagon. As a director, I will be a voting member of the Oregon AIA board and will represent our Eugene Section members. You will all see a choice to join a local section on your membership renewals, so just check that off! Easy! 

We have 172 members who continue to renew their membership because there is value to this association. I’d like to ask that each one of you reach out and support our emerging professionals and encourage them to get licensed and be part of the AIA. At our Holiday Party several members approached me to ask if they can help more actively with the chapter (section) and the answer is always yes! We do have openings for the CoLA committee and for our other programs. We will be putting our 2019 schedule together before the end of year and we'll let you know what's coming up. I can't reiterate enough how helpful it is to participate in our committees, so please reach out if you want to volunteer. Thank you all for your continued membership. 

The reconstituted, single AIA Oregon chapter has a board of directors comprised of eleven directors, including the following: 

• One director appointed for each voluntary section (five total), initially appointed by each disappearing corporation (chapter) 
• Four executive officers (AIA Oregon’s current respective President, Past President (or President Elect), Secretary and Treasurer)
• Two at-large directors appointed by the Board of Directors 

The Executive Committee will also include the AIA Oregon executive director, who will be a non-voting participant on the Board of Directors.

AIA Oregon has established the following internal voluntary local sections: 

• AIA Oregon Portland 
• AIA Oregon Salem 
• AIA Oregon Eugene 
• AIA Oregon Rogue Valley 
• AIA Oregon Bend 

In addition to these sections, the new AIA Oregon chapter may establish other sections with the approval of the Institute Secretary. It’s worth noting that prior to the election, AIA Oregon was itself not a chapter; instead, it was a “council” of the four previous Oregon-based chapters (AIA Portland, AIA Salem, AIA Southwestern Oregon, and AIA Southern Oregon). 

As I mentioned at the top of this post, membership in a local section is voluntary and is not assigned by the Institute or by AIA Oregon. In accordance with the chapter’s articles of incorporation, local sections may not levy dues or assessments on their own behalf. On the other hand, AIA Oregon may allocate funds for specific use by a local section for its exclusive activities. 

One of the primary motivations for the Statewide Chapter Initiative was to better serve the members of the former AIA Salem and AIA Southern Oregon chapters. Because of their small size, these two chapters often lacked the financial resources necessary to provide equivalent access to the kinds of resources and programs enjoyed by the members of AIA Portland and the Willamette Valley-based members of AIA Southwestern Oregon. Because the smaller chapters had a limited pool of volunteers to draw from and inadequate funds to hire paid staff, much volunteer time was devoted to keeping each chapter a viable business entity (which is not typically what a volunteer would prefer to spend his or her time doing). The new statewide AIA Oregon chapter will provide a more efficient governance structure and assume a majority of administrative functions on behalf of the membership so that volunteers can focus upon those issues and programs of greatest interest to them. 

The establishment of the new AIA Oregon Bend Section should likewise benefit the burgeoning number of members located east of the Cascades. 

The articles of incorporation for AIA Oregon govern the local sections. Each section is free to adopt supplemental and supporting policies and procedures that define leadership roles, terms of office, section procedures, and operational guidelines provided such items are in accordance with the Articles and Bylaws and are approved by the AIA Oregon Board of Directors. Formal leaders of each local section will include, as a minimum, a section director who is a member of the AIA Oregon Board of Directors. A section may create other formal leadership roles consistent with their procedures and operational guidelines. 

I’m looking forward to seeing how this momentous transition plays out during the coming years. I’m sure there will be a few bumps along the road but I’m confident moving to a single statewide chapter will ultimately prove to be the right move, with enhanced benefits for all AIA Oregon members.

A final aside: I originally named my blog SW Oregon Architect because it was my position as president-elect for AIA Southwestern Oregon way back in 2008 that prompted its debut. Since then, the blog title and my subsequent Twitter handle (@sworegonarch) have assumed lives of their own, very much independent from their AIA-SWO roots. Despite the dissolution of AIA Southwestern Oregon, I plan to stay with the SW Oregon Architect title and my Twitter identity as they are, and continue to report on AIA news of importance to the former members of AIA Southwestern Oregon.