Construction industry struggles to build a younger workforce

The construction industry is struggling to attract younger workers amid rising building costs and a growing labor shortage throughout the U.S.

The share of younger construction workers declined almost 30 percent from 2005 through 2016, according to the Wall Street Journal, citing an analysis from construction services company BuildZoom. The data found the share of construction workers 24 years old and under has dropped in 48 states since 2005.

There could be multiple reasons why younger workers are steering clear of the construction industry, according to the Journal. Experts say cutbacks to vocational training in high schools could be a cause, along with a greater push for teens to enroll in college. Another possible factor, rising building costs, could mean less money to train and pay workers.

At the peak of the housing boom in 2005, the U.S. had 11.7 million construction workers. But by 2010 the number of workers declined to 10.8 million. It fell even further to 10.2 million people in 2016, according to the Journal.

The labor shortage also comes at a time when supply and material costs are rising, making homebuilding more expensive. That has contributed to an inventory shortage of single-family homes across the U.S., despite a strong economy and growing demand.

Home construction per household remains close to its lowest level in 60 years of record-keeping, according to a March study.

Those factors have also contributed to consolidation of homebuilding companies that are looking to scale up, including Miami-based Lennar’s acquisition of CalAtlantic for $9.3 billion, which was completed earlier this year.

Recently, however, data has shown that the housing market is cooling down amid rising mortgage rates.

The Miami metro area, Chicago and Los Angeles all reported a slowdown in annual home prices in the second quarter of 2018 compared to the previous quarter.  [WSJ] — Keith Larsen