America Is Short One Million Construction Workers
Ariel Skelley / The Image Bank via Getty Images

According to one trade organization, the United States housing market needs up to one million new construction workers.

Associated Builders and Contractors — a trade association that represents the non-union construction sector — stated that shortages in home supply are accompanied by a distorted labor market for construction employees:

Construction spending is likely to reach $1.45 trillion in 2021, up 1.3% from 2020. Under this scenario, employment demand increases by 430,000 this year from actual employment of 7,829,000 in 2020. A higher growth rate scenario could boost the number of additional construction workers needed in 2021 to nearly 1 million.

In the three months since the Associated Builders and Contractors’ release, record demand for homes has only accelerated. A recent analysis from Zillow found that the average house is only remaining on the market for an average of six days. In some cities — such as Cincinnati, Columbus, and Kansas City — the average is three days.

The value of the typical American home has therefore grown by 13.2% since May 2020. Between the first quarters of 2020 and 2021, homeowners observed a collective equity gain of $2 trillion.

On the supply side, construction of new long-term housing has slowed over the past several decades. High costs for lumber and other raw materials are adding nearly $36,000 to the price of an average new single-family home. On the demand side, Americans are moving from cities to the suburbs — in large part because of COVID-19 lockdowns.

Meanwhile, the supply of workers is presently low due to enhanced federal unemployment handouts, which is discouraging workers — particularly in Democrat-run states that have not opted out of the payments — from finding jobs.

Small businessowners in the construction industry are feeling the impact of unprecedented demand; however, their operations are bottlenecked by the worker shortage.

Matthew Messer — the owner of New York Solar Maintenance in Long Island, New York — told CNN Business that he is forced to work alongside his construction staff due to the lack of available labor.

“The phone is ringing off the hook. I am expanding as quickly as I can, but right now that’s governed by the amount of skilled technicians I can bring on,” Messer explained to the outlet. “I was offering $18-$22 an hour and I got no applications. I increased it to $23 and I got none. I increased it to $25 and they’re starting to trickle in right now. It was a dramatic increase, but in order to grow the business, I need technicians.”

Enhanced federal unemployment insurance will not end in New York until September 6 — the last day of its extension under the American Rescue Plan.

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