Labor Shortages Still Hurting Affordability

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Labor and subcontractor shortages remained widespread in July and continue to impact the industry in a number of ways — including putting additional upward pressure on new home prices — according to a recent survey conducted by NAHB. The survey listed 15 specific occupations, and for each one, builders reported widespread shortages of varying degrees, ranging from a low of 47% for building maintenance managers to a high of 83% for framing crews. Labor shortages in 14 occupations were either unchanged or even more widespread than they were at this point last year. The share of builders reporting a shortage of rough carpenters ticked down one percentage point, but remains at a whopping 82%. The same survey asked builders about the effects labor shortages may be having on their businesses. At least three out of four respondents reported that a dearth of workers is:
  • Causing builders to pay higher wages/subcontractor bids (87%);
  • Making it difficult to complete projects on time (81%);
  • Making it harder to find subcontractors with well-trained employees (79%); and
  • Forcing builders to raise home prices (75%).
NAHB Senior Economist Paul Emrath provides more analysis in this Eye on Housing blog post. Readers interested in more details, including a complete history of questions in the labor availability survey, can find them in the full report.

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