Jobs Report Offers Hope for Inventory Crisis
The March jobs report showed an increase in employment within the construction sector, which could be a welcome sign that more inventory will soon be coming to the new-home housing market.
Read more: A Troubling Shortage of Homes
Employment rose 215,000 in March as the unemployment rate remained at 5 percent, according to a report released Friday by the U.S. Bureau of Labor Statistics. But a closer look at the data shows that construction jobs rose by 37,000 in March. Doug Duncan, Fannie Mae’s chief economist, cites the uptick as a response to the short supply of homes for sale. Throughout the year, the construction sector has added 301,000 jobs.
“New construction jobs provided a double boost to the economy in March,” says Nela Richardson, chief economist of the real estate brokerage Redfin. “These jobs not only helped feed strong employment growth but also provided a lift to the housing market, where the dearth of homes for sale has stymied home buyers for the past year. Much of the decline in new housing starts is attributable the lack of skilled construction workers, so the 12,000-worker increase in residential specialty trade contractors is welcome news in today’s report, especially when paired with the pickup in new single-family construction we saw in February.”
A lack of labor has been one of the main challenges cited by the builder’s tradegroup as to sluggish new home construction, along with the challenge of high-cost and lack of availability of lots. Still, homebuilder confidence is showing signs of increase and builders are expressing “optimism that sales will pick up in the coming months,” according to the National Association of Home Builders Chairman Ed Brady.
Source: “March Job Creation Bodes Well for Housing Inventory Crisis,” HousingWire (April 1, 2016)
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