This is a summary of key points from Marble Institute of America’s “The Construction Corner” article in MIA The Cutting Edge Newsletter– September/October 2015 (www.marble-institute.com):
U.S. Home Building Confidence Hits Highest Level in Nearly 10 Years; Lack of Skilled Labor Force Impacting Industry
Despite lingering problems with finding enough qualified workers, in July US home builder sentiment reached its highest level since November 2005, showing confidence in a steadily improving US housing market.
According to the National Association of Home Builders (NAHB), builder confidence in the newly-built, single-family home market reached a seasonally adjusted level of 60 on the NAHB/Wells Fargo Housing Market Index (HMI) in July. The June index was at 60, which makes two consecutive months at a high level. A reading over 50 is considered positive.
The Wall Street Journal reported that the index has been positive for the past year. Single-family home starts in May 2015 stood at 690,000, a little more than 1/3 the number of starts in May 2005, and slightly more than 1/2 the number of starts in May 2000.
According to Yahoo Finance, builders across the country say there is good demand for new homes., but complain they are handcuffed by a lack of skilled labor to build homes.
NAHB said “The nine-trade shortage is now substantially higher than it was at the peak of the 2004-2005 boom, when annual starts where averaging abound 2 million, compared to current rates at about one million.
The Associated General Contractors of America said that unemployment in the construction industry fell in June to the lowest level since 2001.
In the meantime, the US Census Bureau announced in late July that construction spending during May 2015 was estimated at a seasonally adjusted rate of $1,035.8 billion. This was 0.8 percent above the revised April estimate of $1,026.0 billion. Residential construction was at a seasonally adjusted annual rate of $359.5 billion in May, 0.3 percent above the revised April estimate of $358.5 billion. During the first five months of 2015 construction spending amounted to $382.1 billion, 5.9 percent above the $360.8 billion for the same period in 2014.