The construction industry is facing a 200,000-person labor shortage, according to a report released today by the Home Builders Institute (HBI).
According to the first-ever HBI Construction Labor Market Report, skilled trade workers directly employed by home builders and subcontractors continue to be in short supply across all regions.
The difficulty in filling positions is one of the top three concerns among builders nationwide, trailing only high lumber prices and regulatory burdens.
Ed Brady, president, and CEO of HBI, stated, “Skilled labor is in short supply in the home building industry. This ongoing challenge jeopardizes housing affordability and availability and impedes a robust economic recovery.”
The report will be issued semi-annually and is based on research from the National Association of Home Builders’ Economics Group. The first is based on information from the end of 2020. Brady, citing more recent data, stated that the total construction worker shortage increased to 309,000 in January 2021.
Sixty percent of builders said there was a labor shortage. The percentage is especially high in comparison to the acceleration in total housing starts, which increased from a seasonally adjusted annual rate of less than 1 million single-family and multifamily units in April 2020 to a rate of approximately 1.5 million by the end of 2020.
The figures reported are for direct labor employed by builders, but builders employ additional workers through subcontractors. “We estimate that builders subcontract more than 80% of the construction in the average home.
Subcontractor labor shortages are becoming even more severe.” Brady went on.
According to HBI’s CEO, labor accounts for approximately 30 to 40% of the cost of a typical new home.
“Because of a labor shortage, this portion of the cost is increasing. When you consider that a lack of labor causes construction delays, which leads to additional costs, you can see how both housing supply and affordability suffer “HBI’s CEO went on to say.
HBI is the nation’s leading provider of residential construction skilled worker training.
Using an industry-recognized curriculum, the nonprofit trains approximately 10,000 students each year in 220 locations across the United States, including high schools, military bases, community colleges, prisons, training facilities, and Job Corps centers.
“As a country, we must train the next generation of skilled tradespeople. This necessitates the recruitment of more women. It entails preparing and placing minority, low-income, and at-risk youth for employment opportunities as an important means of combating social inequity. It entails teaching veterans and transitioning military members trade skills. And it entails reaching out to high school students and those who influence their decisions in order to change their perception of trades careers “Brady stated.
