There is a big demand for skilled labor and there are not enough workers to fill the job requirements. The drop in employed blue-collar workers started with the financial crises and the need has not been filled since then.
PeopleReady and other construction staffing companies explain that the current demand could be traced back to the financial crisis of 2008. Due to the crisis, there was a slump in housing starts, which resulted in more than 30% of all construction workers looking for other jobs. At the time, there was no available construction job and the workers had to be let go. After 10 years, many of the lost workers never returned to construction, just when there’s a construction boom.
Starting from Scratch
The loss in manpower during the financial crisis was not just in terms of actual workers. It also realigned the career choices of people, forcing them to avoid going into construction. The loss of a pipeline of workers for the jobs is still being felt 10 years after the crisis. It takes a while before a person can be experienced enough to work in a construction firm. Learning to be a mason or a carpenter also takes time.
High school graduates were not interested in going into blue-collar jobs. The jobs required skills for carpentry, drywall, electrical, welding, and plumbing. Workers at all levels of experience are needed to fill the demand. In a 2016 study, the National Association of Homebuilders estimated that there were 200,000 unfilled jobs in the construction industry. In addition, the demand for new construction workers is greater than the number of new workers.
The effect of this demand extends from the construction of new houses. As the demand for new houses increases, the supply of new construction fails to meet the demand. This, in turn, creates a backlog on supply. In addition, with the need for new houses not being filled, new buyers are not able to enjoy low mortgage rates.
The demand for new houses is not being met due to the lack of new construction workers. The demand for new workers is not being filled fast enough, resulting in lost opportunity for housing sales.