Feast or Famine; Home Builders now Face Labor Shortages

Residential home
builders are reporting that a lack of available labor is hampering new home
construction
the National Association of Home Builders (NAHB) said today.  The worker shortage is evident in most of the
trades.

Homebuilders
responded to a survey by NAHB with more than half reporting they had
encountered labor shortages over the last six months that have caused them to
pay higher wages or subcontractor bids and consequently raise the price of completed
houses.  Forty-six percent said they had
experienced delays in completing projects, 15 percent had to turn down work,
and 9 percent lost or cancelled sales because they could not find appropriate
help.

“The survey
of our members shows that since June of 2012, residential construction firms
are reporting an increasing number of shortages in all aspects of the industry
– from carpenters, excavators, framers, roofers and plumbers, to bricklayers,
HVAC, building maintenance managers and weatherization workers. The same holds
true for subcontractors,” said NAHB Chief Economist David Crowe.

NAHB estimated
that more than 1.4 housing jobs disappeared during the peak of the downturn. Many
construction workers found other employment while some trades retrained
construction workers and they are not returning to the residential construction
sector.

“What used to be high-paying, skilled jobs vanished as builders across the
nation went out of business or were forced to let workers go,” said NAHB
Chairman Rick Judson.  

NAHB is trying to help meet the demand for skilled labor by providing career
training and job placement in conjunction with the Home Builders Institute
(HBI).  HBI offers an array of portable
pre-apprenticeship training programs in a variety of skilled trades that can be
customized to meet the workforce needs of communities across the nation.

“We are
ramping up our efforts to train diverse populations and place them in jobs to
meet the growing demand of the building sector,” said HBI President and
CEO John Courson.

A lack of buildable lots and increased costs for materials and labor are also
contributing to the problem, as the infrastructure that supports home building
moves to re-establish itself following the worst housing downturn since the
Great Depression, Crowe said.

The problems
confronting builders are also hurting job and economic growth. NAHB says the
construction of 1,000 single-family homes generates more than 3,000 jobs,
approximately $145.4 million in wages, and more than $89 million in federal,
state and local tax revenues. That doesn’t even count the increase in annual
property taxes that local municipalities rely on to fund schools, police and firefighters.

As the economy
mends, pent-up demand for housing will continue to grow as roughly 2 million
household formations were delayed as a result of the Great Recession. In normal
economic times, demand for new homes should be about 1.7 million annually.

“We need to look holistically at the home building infrastructure to meet
growing and future demand,” said Judson. “To avoid a run-up in prices
in hot markets due to labor issues, we need to complement our current training
programs with a market-based visa system that would allow more immigrants to
legally enter the construction workforce each year when there is a dearth of
workers to fill the jobs that are needed.”

Article source: http://www.mortgagenewsdaily.com/03212013_housing_recovery.asp

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