A skilled labor shortage has been brewing in the U.S. construction industry for a long time, and the second half of 2022 could see the problem worsening. Inflation, an aging workforce, and the inability to fill positions will likely further increase costs, wages, and the price of real estate development and building anything in the U.S. “The next six months will be like the last six months, only worse,” said Anirban Basu, Chief Economist for the Associated Builders and Contractors.
Currently, there are about 25 percent more unfilled construction positions than new hires, according to Nick Grandy, a construction senior analyst at consultancy RSM US. Many expect wages to continue to grow for construction employees because of the high demand for workers and low supply. “We’re going to see jobs predicted to cost $500 million end up costing $600 million because you’re going to need to pay people more,” Grandy said.
There were approximately half a million job openings in the construction industry in April 2022, according to Bureau of Labor Statistics projections, a number that has continued to get higher. Filling those positions will be difficult because 20 percent of the nation’s construction employees are 55 and older, meaning that about a fifth of the industry will likely retire within the next 6 years. And while technologies like modular and prefab construction may help fill the labor gap some, their tech and scalability haven’t advanced far enough to make much of a dent.