According to home builders, the nation's housing market is facing a shortage of qualified construction workers. According to economists, however, the numbers just don't add up.
As of November 2015, the rate of unemployment for those in the construction industry is roughly 6.2%, and in 2014 the number of construction workers per housing unit was found to be 40% higher than it was before the housing crisis.
In addition, economists argue, in a true shortage one would expect that the wages of construction workers would be rising rapidly; according to a report from J.P. Morgan Chase & Co., this isn't happening.
With so many available construction workers unemployed and construction wages continuing slowly forward, how can it be true that there is actually a shortage of skilled workers?
True or false?
As it turns out, the claims of a worker shortage aren't entirely baseless. Survey results and anecdotal evidence suggest that there may still be a true shortage of skilled construction workers in certain markets, but not in all.
To illuminate the reality of which markets truly lead the shortage claims, the National Association of Home Builders (NAHB) performed a survey of industry builders in 2014. According to the results, the two types of workers builders are most in need of are framers and carpenters.
For framers, 15% of builders reported a serious shortage, 45% reported some shortage and 41% reported no shortage. For finish carpenters, 12% of builders reported a serious shortage, 46% reported some shortage and 42% reported no shortage.
Finally, for rough carpenters, 11% of builders reported serious shortage, 52% of builders reported some shortage and 37% reported no shortage.
Overall, the NAHB's survey revealed that roughly 46% of industry builders reported some manner of shortage across nine categories of construction tradesmen--a rise of 12% from the year before the survey (2013).
Incredibly, this is also a higher percentage of reported shortage than there was between 2002 and 2006, when the market saw twice as many homes being built.
The bottom line & the obscurity of statistics
Moody's Analytics housing economist Celia Chen told the Wall Street Journal last year that these broad, aggregate statistics don't offer much insight into the subtleties of the housing market.
General data from the Bureau of Labor Statistics don't allow us to determine individual markets, or see whether certain workers are skilled or unskilled.
Therefore, says Chen, builders may still be facing real shortages in certain sub-markets, even if the national market appears to be balanced per the data.
Subcontractors, for example, are reported by NAHB members as being in high demand, but are primarily self-employed workers and sole-proprietorships, which may not be counted by government statistics.
Whatever the case, builders are likely to continue seeing some shortages across trades and experience rising wages and other headaches in the near future. The good news? The data shows it isn't as bad as it sounds.
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