Friday, June 16, 2017

The Empty Lots Are Rotting, Turning Into Fields

The advocates for cheap labor never miss an opportunity to claim they need more cheap labor.
Home builders cut back for third straight month
Yet builders increasingly complain they cannot find enough good construction workers to get the job done and that could be constricting them. Consider the recent slide in building permits. They fell 4.9% in May to an annual rate of 1.17 million, the lowest level in 13 months.

Permits are also below year-ago levels,

In May, the biggest drop-off occurred in the South and Midwest. Construction rose slightly in the West and was flat in the Northeast.

For years the housing market has experienced a mini-renaissance of sorts as a steadily growing economy, rising employment and ultra-low interest rates enabled home people to buy homes.

The outlook might not be as favorable now, though. Aside from widespread labor shortages, prices for wood and other raw materials have also risen. And the Federal Reserve has embarked on a series of increases in a key U.S. interest rate that helps determine the cost of borrowing, a potential brake on future sales.
Here is construction employment through April and residential building construction employment through May. There is a leveling off in employment which would be consistent with a leveling off of growth, not a decline in growth. If home construction is declining, there's no evidence it is caused by a labor shortage.

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