Labour shortage slows down construction in us

Condos being built in Brooklyn, New York Photo: Michael Tapp

A shortage of labour is slowing down construction activity in America, according to new figures.

The UK and US are both racing to get builders building homes again, as demand from buyers and a chronic lack of housing is both pushing prices up and slowing down transactions. But both markets are also seeing a range of factors impede momentum among developers, as house builders struggle with rising costs of building materials and a shortage of labour.

The industry continues to feel confident and recover at a steady pace, but growth stumbled in August 2015, according to the US Department of Housing and Urban Development and the Commerce Department, with nationwide housing starts dipping 3 per cent to a seasonally adjusted annual rate of 1.126 million units. Overall permit issuance rose 3.5 percent to a rate of 1.170 million.

"Permit growth indicates that our members feel confident that consumers are returning to the market," says NAHB Chairman Tom Woods, a home builder from Blue Springs, Mo. "However, builders are reporting concerns with lots and labor availability, which could have contributed to this month’s production dip."

Single-family housing starts fell 3 per cent to a seasonally adjusted annual rate of 739,000 in August while multifamily starts dropped 3 per cent to 387,000 units. Combined single- and multifamily starts fell in three of the four regions in August: the Northeast, Midwest and West posted respective losses of 33.7 per cent, 9.8 per cent and 1.1 per cent. The South registered a 7.1 per cent gain.

Multifamily permits rose 4.7 per cent to a rate of 471,000 while single-family permits increased 2.8 percent to 699,000. Regionally, the Midwest, South and West posted respective permit gains of 2.9 per cent, 2.4 per cent and 9.6 per cent. The Northeast fell 4.4 per cent.

"Year-over-year increases in single and multifamily production, and rising builder confidence all bode well for a continuing, gradual recovery throughout the rest of the year," adds NAHB Chief Economist David Crowe.