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Labor Shortages Hamper New Homebuilders

comments (0) May 5th, 2014 in Blogs
ScottG Scott Gibson, contributing writer

A shortage of skilled labor is a major problem for homebuilders in some parts of the country and is responsible for construction delays and higher prices for new houses.

The National Association of Home Builders says 65% of the builders it surveyed recently said the cost and availability of workers will be a "significant challenge" this year. In survey data from last year, 54% of builders said labor shortages meant higher construction costs and 46% said limited workers were making it hard to finish projects on time, the trade group said.

The government reported the number of unfilled construction jobs rose 38% from January 2013 to January 2014, to a total of 156,000, NAHB said in a recent "Eye on Housing" report. Home building has added 101,000 jobs in the last year and now stands at a total of 2.2 million.

Shortages seem particularly acute in the Denver area where some construction workers have migrated to energy companies drilling for oil and gas in northeastern Colorado and North Dakota, The Wall Street Journal reported. Many Mexican workers returned home during the housing downturn, compounding the problem.

As a result, some builders have been unable to hire as many skilled workers as they'd like, and those who are hired can command higher wages. Framers are getting as much as $40 per hour, what they were making in the pre-housing-bust years of 2005 and 2006, WSJ said, and skilled tile setters can make $100,000 a year.

Nationally, construction wages are going up three times as quickly as those for all workers, up more than 6% in February from a year earlier.

Other areas where labor shortages are hampering building include Texas, Minneapolis, Oklahoma, south Florida, and Charlotte, N.C.


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