Friday, August 28, 2015

Construction Labor Shortage Getting Worse

Construction of homes and commercial buildings is up significantly this year but the industry would be sizzling if not for a critical shortage of workers, industry officials say.

The labor crunch is delaying projects, raising home prices and forcing companies to turn down work, which in turn curtails building activity and economic growth.

Spot labor shortages began in 2012 as new construction slowly came to life following the 2000's real estate crash. But they've spread across most of the country and have been accentuated this year by a strong recovery in both residential and commercial building.

"I would go so far as to call it an epidemic," says Jerry Howard, CEO of the National Association of Home Builders.

Nearly 70% of home builders surveyed by his group in June reported a shortage of carpenters, for example, up from 63% a year ago. And in a July survey by Associated General Contractors, 86% of commercial builders said they're having trouble filling hourly or salaried positions, up from 83% last year.

Many construction workers left the industry during the downturn to become truck drivers, factory workers or roughnecks in the then-booming oil industry. Most aren't returning even as building activity rebounds, Howard says.

Housing starts have increased 11.3% so far this year compared to the same period in 2014 to a post-recession high, government figures show. And commercial construction spending rose 9.7% during the first half of 2015.

Meanwhile, the pipeline of new workers has thinned over the years. Many high schools have phased out shop classes and parents increasingly have steered graduates to four-year colleges and white-collar careers. The Home Builders Institute, which does training, and local home builders groups, recently have rolled out more instruction programs but it takes 12 to 18 months for a new recruit to become a productive worker, Howard says.


Anonymous said...

I have a crazy idea...raise wages to attract skilled workers?

Anonymous said...

I have a crazy idea. Limit immigration that is depressing real wages in the construction fields.

Anonymous said...

Great idea - IF it attracts PRODUCTIVE skilled workers. As an ex-framer in the early 2000's who had a scale from $10 labor, $25-$30 skilled carpenter and $30-$40 field manager $$ do not increase productivity. Like many of their counterparts in the white collar world just showing up does not a house build or make $$ for the business owner.