The Labor Shortage is Putting a Big Squeeze on Real Estate Developers

About 60% of contractors who are struggling with the labor shortages squeezing the construction industry say it’s becoming a challenge to finish jobs on time, according to a survey conducted by USG Corp. and the U.S. Chamber of Commerce.

“More than one-third of contractors said they are being forced to turn work down and 58% said they are putting in higher bids.”

The survey was conducted as part of an outlook into trends such as backlogs, revenue projections, access to financing and labor issues.

“Two thirds of the contractors surveyed predicted there would be more workers in the next six months. But 61% of the respondents reported problems finding skilled laborers in such trades as concrete, interior finishes, masonry, electrical and plumbing.”

Industry officials are warning that labor shortages will become more desperate if the Trump administration moves forward with it’s plan to spend $1 trillion on infrastructure. “We couldn’t absorb $1 trillion worth of brand new work,” said Mr. Jones. “We’re already strapped just dealing with the work we already have.”

“Labor shortages are partly due to the increasing number of construction projects moving forward. During the first four months of this year, construction spending amounted to $359.5 billion, 5.8% more than the same period in 2016, according to the U.S. Census Bureau.”

Furthermore, tens of thousands of workers left the building trade during the economic downturn either because they couldn’t sustain the drought or due to aging out.

Sources: Peter Grant, The Wall Street Journal http://www.realtor.com/news/real-estate-news/labor-shortage-squeezes-real-estate-developers/

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