Construction jobs rise; will housing inventory do the same?
Building jobs jump up
The latest news out of the Bureau of Labor Statistics may bode well for the housing market — and Americans looking to buy into it. According to the BLS’s recent jobs report, construction employment was up by 13,000 in June and has risen by more than 280,000 since the start of the year.
More jobs, more homes?
Residential construction, in particular, has seen growth in recent months. Jobs in the sector increased by 4,000 last month — a 0.5 percent jump over May.
According to Mark Fleming, chief economist at First American, the uptick “sends a positive message to homebuyers and the housing market.” It could even mean more housing starts — and subsequently, more inventory — are en route.
“It indicates further increases in housing starts are likely and more housing supply may be on the way,” Fleming said. “It’s very hard to have one (housing starts) without the other (residential construction employment).”
Part of a larger trend
Overall, residential construction jobs are up 6.5 percent since June 2017. It’s likely the reason why housing starts have risen since the start of the year, hitting an 11-year high in May.
“Specifically for the housing market, residential construction employment increased, which is critically important to increase the pace of housing starts and add more housing supply to the market,” Fleming said. “Building a home does not readily lend itself to outsourcing and automation. Homebuilding still requires manual labor as a key input into the production process.”
Specifically, Fleming predicts housing starts to average 1.3 million or higher for the next three months.
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