Jonathan H. Todd: September home construction data show strength in the housing market. This may not actually benefit the construction labor market, though.
After six years of essentially zero growth, homebuilders are finally starting to realize that the glut of single-family homes built in the mid-2000s has disappeared. This has led to more construction, as shown by today’s release of September housing starts, which climbed 6.3% to an annualized 1.02 million pace.
Already, multi-family housing has seen not only a return to normal conditions, but something of a boom. July’s reading of 440,000 starts is this highest reading since November 1987.
Multi-family construction has surpassed even the boom years of the 2000s.
Single-family housing may not be far behind. According to a recent survey of economists by the Urban Land Institute and EY, single-family housing starts are expected to rise to 912,500 by 2016. This is well below the peak pre-Crisis years, but getting closer to the long-term average of 1.073 million per year.
Single-family housing starts are expected to move toward the long-term average by 2016.
Housing and Employment, Formerly Joined At The Hip…
The housing boom of the early 2000s directly led to low unemployment rates. Places like Las Vegas and Phoenix were then the North Dakota of today – there weren’t enough workers to fill the need for labor.