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SCCA Member: Rick Siewert, Siewert Cabinets

Local Architects Give Insights on Economy and How They Managed

As 2012 enters its third month, signs that the economy is slowly turning for the better keep popping up. One area that had been hit hard during the past six years was the architectural field. At one point, estimates placed the unemployment rate for architects to upwards of 40%. However, recent statistics show improvement – housing sales increased 4% this past January, and construction jobs grew by 5.8% in December.

Local Seward neighborhood architects Charles Levin of Charles Levin Architects and Gar Hargens of Close Associates provided their insights and views on what happened the past few years, how they weathered the storm, and where they see architecture progressing in the future.

One of the primary reasons why the construction industry was hit so hard, according to Levin, was that construction companies were geared up for an inflated level of demand. Most had acquired large stockpiles of supplies and hired additional staff. When the housing market crashed, there was a need to consolidate and tighten up the company, which meant significant lay-offs across the industry.

As a one-person firm, Levin was able to withstand the pressures of the down economy more easily than some of the mid-sized firms. Larger companies had to think of different ways to receive work. One route many went was bidding for public institution projects, which was one of the few sectors still building. Others went after projects that align with inelastic trends in demand, like elderly housing and hospitals. Firms embraced other trends in the market, such as designing organic food stores.

Close Associates did not have to make many adjustments to their firm’s strategy. As they approach Close Associates’ 75th anniversary next year, Hargens stated that the firm’s longevity helped mitigate the effects of the recession. Many Close Associates projects were initiated because of the company’s expansive network. Hargens stressed the importance of establishing relationships with people during every project. Word of mouth can be a very powerful marketing tool when used strategically.

Making the firm highly visible is a goal that Close Associates made a point to pursue during the past few years. One unique practice that Hargens began was sending out what he calls “Close Cards.” Each post card features a photo and description of a building completed by the firm. By periodically sending these cards to over 4,000 people, Hargens ensures that Close Associates remains in the forefront of the minds of their contacts.

As architectural firms move forward, many of the methods they initiated during the past seven years will continue to be used in their day-to-day operations. Instead of specializing in a single project type such as single-family housing, firms will diversify and work on a whole range of projects. After laying off so many employees, Hargens believes firms will be hesitant to hire back full-time staff. Instead, these firms are hiring employees on a project-by-project basis. When bids for larger projects are won, it won’t be uncommon to see two firms collaborate and work together. With today’s technology and real time sharing of computer files over the internet, Hargens can work on a building design, save it, and then have an architect in downtown Minneapolis or St. Paul access it immediately and make additions.

The field of architecture is, in some ways, an extreme example of the trends that occurred in all businesses during the recession. Many businesses had to reduce the size of their staff, diversify their services, adapt to new practices such as using contract workers and partnerships, and increase their use of technology. As we move toward economic recovery, it is likely that architects will also be on the forefront of demonstrating how businesses across the board will operate in the new economy.

Close Associates' Gar Hargens

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