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Labor Shortages Continue to Burden Builders

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Labor + Trade Relations

Labor Shortages Continue to Burden Builders


February 21, 2020
Aerial view of construction site
Photo: Andy Dean

The labor shortage is still the top concern for builders in 2020. Despite a slight decline in the number of builders who expect challenges in the cost and availability of labor, 85 percent of builders are still worried about what this year will bring.Coming in tied for the second top concern were material prices and the availability of lots. Finding skilled workers, especially young ones, feels more like a quest than a normal hiring process, but the worries about a labor shortage was not always the norm. The early 2010s were not even close to the golden days for construction, but in 2011, only 13 percent of builders ranked that labor was an important concern.

The cost and availability of labor continues to stand out as the most significant challenge that builders will face in 2020, according to a recent survey of members that ran in the monthly NAHB/Wells Fargo Housing Market Index (HMI).

More than four out of five builders – 85% – expect to face serious challenges regarding the cost and availability of labor this year, down slightly from the 87% who rated this issue as their top concern in 2019.

Building material prices and the cost and availability of lots were tied as the No. 2 problem expect to face in 2020, with these issues cited by 66% of the survey respondents.

All three of these supply-side issues have been a growing concern for builders over the past several years. To put it into perspective, in 2011, just 13% of builders cited labor issues as an important concern, with the rate steadily rising over the ensuing years before peaking at 87% last year.

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