To ease severe worker shortages that are delaying construction timelines and raising housing costs, home builders must make fundamental changes to the way they do business, Ed Brady, CEO of the Home Builders Institute (HBI), said during a press conference at the 2022 International Builders' Show in Orlando.
Brady, a former NAHB chairman and a second-generation home builder for more than 30 years, said the chronic labor shortage is a "long-term structural crisis." He issued a "call to action for an all hands and industry-wide effort to increase training, compensation, diversity and productivity."
While construction wages are up, what prospective workers also want is to see that the residential construction industry will provide them with a solid future. "We need to take a look at the traditional business model of home builders and ask ourselves whether it is properly structured to attract, retain and build the next generation of the nation's construction labor force," Brady said.
HBI's most recent Construction Labor Market Report shows that to meet the nation's housing demand, the residential construction industry will need to train and place a staggering 2.2 million new workers within the next three years. Brady laid out the following steps the industry must take to attract more workers into home building:
- Recruit more women
- Train and place more minority, lower-income and second-chance youths and adults
- Provide trade skills education and training to veterans and transitioning military
- Develop a national immigration policy that works
- Change entrenched and misguided perceptions of careers in construction
A Changing Workforce
Brady added that home builders should consider the behaviors that the labor market is displaying in this era of the 'Great Resignation.'
"The nature of the workforce is changing. And it is not just about higher compensation, although builders will have to stay vigilant on that score to remain competitive in the labor market, while balancing the need to keep housing and homeownership affordable," he said. "Beyond better paychecks, people are looking for the best overall workplace environment when they choose what careers to pursue," he said.
Productivity is Key
NAHB Chief Economist Robert Dietz, who joined Brady at the press conference, underlined the need for gains in productivity, which has increased in the construction sector by only eight percent since 1993. He said that gains in productivity can significantly contribute to narrowing the gap between housing demand and the supply of workers.
"The only way to achieve sustainable gains for residential construction wages is to realize improvements for workforce productivity," Dietz said. "This can be earned via new methods of operation, higher levels of training, and investment in capital and technology. Higher wages will then allow for additional recruitment in the sector."
For its part, HBI is ramping up several major programs to address the scarcity of construction labor, according to Brady. “With the generous support of our financial partners, HBI is building and sustaining a multi-faceted attack on the problem."
Learn more at hbi.org.