Home builders have their strongest sales this year after the recession, but the lack of labor workers may greatly deter them to deliver the new homes in time.
In a press release by Dow Jones Business News in Nasdaq, a government data shows that the United States residential construction climbed above $36 billion in August. The problem is that they are 676,500 fewer workers in residential construction nationwide to handle the work this time around.
Economists and builders say that the delay may dent the builders profit because of the higher labor costs and the high concession of buyers.
Bernard Markstein, a construction-industry consultant and president of Markstein Advisors, said that the delay could eventually price out some of the potential buyers.
"Eventually, the higher costs, if we want these projects to go forward faster, are going to mean passing on the costs," said Markstein.
Experts pointed out three main reasons for the shortage of labor workers in residential construction.
First, the wage of labor workers in residential construction are still too low to attract qualified workers to the physical and dangerous work of building a house. Second, the tightened immigration policies are making it hard for foreign workers to return to the United States. The last reason is that many district schools have focused less on certain vocational training, resulting to emaciation of the efforts to train and recruit young trade workers.
The hourly wage of a residential-construction worker was at $26.32 in August. It is just a dollar higher than the $25.10 wage of a job in a private sector. But that difference does not suffice to entice those who work in private sectors to leave their jobs and jump to residential construction.
According to the Housing Analyst, the shortage in the labor force of residential construction will only cause delay in the short term, but in the long run it will lead to higher home prices.
