From the Desk of Steve Espinosa:

California’s Housing Crisis

To address California’s affordability crisis, policymakers increasingly agree that housing production must increase quickly. Finding the workers to perform that construction is likely to be a challenge. Four out of five respondents nationally in an Associated General Contractors (AGC) survey and nearly as many in California – 78% – said they were having a hard time filling some or all hourly craft positions. As for the outlook for filling positions in the next 12 months, roughly three-fourths of respondents nationally and in California expect it will be as hard or harder to fill hourly craft positions. To produce enough housing to keep the crisis from getting worse, California must recruit at least 100,000 new residential construction workers. And to produce enough new housing to start making housing more affordable – California needs at least 200,000 new construction workers.

Builders have sought to meet the demand for workers with increased employment instead of productivity. Wages and compensation are not competitive in the housing construction industry. Adjusted for cost of living, median California construction trades pay ranks 46th in the U.S. On average residential construction workers earn 33% less per year than non – residential construction workers. When California housing production peaked during the 70’s and 80’s, average hourly pay for most residential and non – residential workers were practically equal. The share of construction workers facing some form of wage theft is up 400% since 1972. On average, construction jobs require longer commutes and among all major industrial sectors, construction jobs have the third highest occupational injury rate and a lifetime risk of lost time. Housing builders’ reservoir of low – wage, less skilled labor is not refilling. This hinders the ability to attract and retain the workers needed to increase production of new housing.

So how do we solve the California housing Crisis? Builders can start by using Union Labor that pays living wages and benefits. This will help attract workers into the residential construction industry. Union apprenticeship programs produce the most productive workers, thus increasing productivity. Union workers are safer, which ensures fewer workplace safety problems. All the trades need to take advantage of the current residential construction man-power shortages. We know that using Union Labor in residential construction would play a vital role in restoring California’s residential building to the production engine that it once was.