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America Is Short One Million Construction Workers

America Is Short One Million Construction Workers


According to one trade organization, the United States housing market needs up to one million new construction workers.

Associated Builders and Contractors — a trade association that represents the non-union construction sector — stated that shortages in home supply are accompanied by a distorted labor market for construction employees:

Construction spending is likely to reach $1.45 trillion in 2021, up 1.3% from 2020. Under this scenario, employment demand increases by 430,000 this year from actual employment of 7,829,000 in 2020. A higher growth rate scenario could boost the number of additional construction workers needed in 2021 to nearly 1 million.

In the three months since the Associated Builders and Contractors’ release, record demand for homes has only accelerated. A recent analysis from Zillow found that the average house is only remaining on the market for an average of six days. In some cities — such as Cincinnati, Columbus, and Kansas City — the average is three days.

The value of the typical American home has therefore grown by 13.2% since May 2020. Between the first quarters of 2020 and 2021, homeowners observed a collective equity gain of $2 trillion.On the supply side, construction of new long-term housing has slowed over the past several decades. High costs for lumber and other raw materials are adding nearly $36,000 to the price of an average new single-family home. On the demand side, Americans are moving from cities to the suburbs — in large part because of COVID-19 lockdowns.

Meanwhile, the supply of workers is presently low due to enhanced federal unemployment handouts, which is discouraging workers — particularly in Democrat-run states that have not opted out of the payments — from finding jobs.

Small businessowners in the construction industry are feeling the impact of unprecedented demand; however, their operations are bottlenecked by the worker shortage.

Matthew Messer — the owner of New York Solar Maintenance in Long Island, New York — told CNN Business that he is forced to work alongside his construction staff due to the lack of available labor.

“The phone is ringing off the hook. I am expanding as quickly as I can, but right now that’s governed by the amount of skilled technicians I can bring on,” Messer explained to the outlet. “I was offering $18-$22 an hour and I got no applications. I increased it to $23 and I got none. I increased it to $25 and they’re starting to trickle in right now. It was a dramatic increase, but in order to grow the business, I need technicians.”

Enhanced federal unemployment insurance will not end in New York until September 6 — the last day of its extension under the American Rescue Plan.

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