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2015: issue 9
WORKFORCE: Construction worker pay soars as homebuilders hunt for labor It’s a good time to be in the field. The shortage of construction labor is wreaking havoc on homebuilders, but it’s welcome news for workers in the field. Companies like Shea Homes, Hovnanian Enterprises Inc., and Beazer Homes USA have all identified the scarcity of workers as a factor that’s causing an industry slow down. Meritage Homes Corp. even lowered its forecast last week because of rising labor costs and the difficulty it’s having finding enough workers to finish projects, Bloomberg reports. The worker shortage is so acute in Arizona that Active Lifestyle Communities, part of Shea homes, is telling customers that their homes may not be completed for a year—about twice the time it usually takes. There are a bunch of reasons why construction workers are hard to find. Many construction workers left the field when the housing market collapsed during the recession. They entered sectors that were healthier at the time, such as trucking, and oil and gas production. Despite housing’s rebound, the laborers aren’t returning, in part, because the pipeline of talent has dried up as schools have cut shop classes and two- or four-year colleges attract would-be workers. Plus, increased enforcement along the Mexican border could be keeping foreign workers from entering the country
While that’s bad news for homebuilders—52% of them told the National Association of Home Builders that they experienced a labor shortage in June, up from 46% last year—it’s good news for folks in the field or those looking to enter it. and seeking jobs in the field, Bloomberg says. The fallout of those factors has come as buyers sign contracts faster than they have since before the housing crash. While that’s bad news for homebuilders—52% of them told the National Association of Home Builders that they experienced a labor shortage in June, up from 46% last year—it’s good news for folks in the field or those looking to enter it. The scarcity of workers in construction means employers are paying higher to lure laborers to the industry. As of August, average hourly earnings in
the construction industry were up 2.8% over the prior year. That’s ahead of the wage growth across all industries—2.1% for the year in August. Pay in the field may continue to rise since the shortage of workers is unlikely to get better anytime soon. The Bureau of Labor Statistics projects that the United States will need 25% more construction laborers by 2022—a figure that far outpaces the growth of the U.S. workforce overall. A similar increase—24%—is expected for carpenters. by Claire Zillman, fortune.com
Bill 505 that removed the dual credits cap, thereby allowing students the opportunity to graduate from high school with not only an industry or trade certification, but with an Associates Degree. Home building companies are excited about the opportunity to welcome these skilled, educated graduates into our industry to help ensure that we can provide shelter for the citizens of our state. The mission of the Texas Builders Foundation, the charitable arm of the Texas Association of Builders, is to support and develop the future of Texas' construction workforce by providing scholarships to students who are enrolled in construction related
programs in Texas' technical and trade schools and colleges and universities. By designating October 2015 as "Careers in Construction Month," the Governor has provided the Texas Association of Builders and the Texas Builders Foundation with an additional tool in their efforts to educate the youth of Texas on the construction industry as a professional career path. In 2014, the Governor issued a similar proclamation, and we are honored that Governor Abbott supports the need to continue to promote and recognize the professional construction workforce in Texas.
OCTOBER Careers in Construction Month' At the request of the Texas Association of Builders, Governor Greg Abbott has proclaimed October 2015 "Careers in Construction Month" in the State of Texas to increase public awareness and appreciation of construction craft professionals and the entire construction workforce. See the proclamation here. The Texas Association of Builders, an affiliate of the National Association of Home Builders, has 28 local home builders associations and nearly 10,000 members across Texas, representing over 702,500 jobs and more than $31 billion annually in the Texas economy. For the last several years, Texas' residential construction industry has faced a shortage of skilled workers and over the next five years, 20 percent of skilled laborers in the construction industry will retire. According to the Texas State Data Center, in 2014 an estimated 2,600 individuals moved to Texas every day, and as additional individuals and companies continue to relocate to our great state, the need for quality, affordable housing will continue to be in demand. In 2013, the Texas Legislature passed House Bill 5, the comprehensive education reform bill, that gives high school students a choice in their postgraduation path, allowing them to prepare for college, or choosing elective courses that prepare them for employment immediately upon graduation from high school by, for example, earning construction industry or trade certifications. This year, the 84th Texas Legislature passed and the Governor signed into law, House Bill 18 and House