Labor Shortages Affecting New Home Costs

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New home construction has been slow ever since the recession.  This is in part blamed by the lack of materials, but mainly the shortage of labor is the top factor.  Worst of all, these labor shortages seem to be growing.

Almost all the different jobs that go into the construction of a new home are being affected.  The worst hit are carpenters and framing crews.  63% of builders reported either some or a serious shortage in carpenters and 60% reported either some or a serious shortage in framing crews.  Right behind them are bricklayers, masons, and electricians.

The shortages of labor also reach subcontractors. The above numbers are actually worse for subcontractors, making them even more in demand.  68% of builders reported either some or a serious shortage in carpenters and 68% reported either some or a serious shortage in framing crews.  On average, builders use 25 different subcontractors on a single home.

These numbers are larger than last year and the high shortages are surprising with the current rate of new home construction, since it hasn’t recovered from the housing crisis.  The seasonally adjusted rate of new home constructions that have started are now at 1.2 million units.