Construction Report: Millennials Shrink Labor Force
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As the US economy recovers, development is on the rise. However, so are construction costs, according to a new construction economics report released by Leopardo. The report reveals that while the cost of construction supplies has decreased significantly along with the cost of fuel and oil, labor costs are going up due to supply and demand. Roughly 25% of construction workers left the industry in the past seven years, and fewer Millennials are pursuing careers in the trade. Add to that the number of older workers retiring and you're left with fewer experienced professionals. Meanwhile, the work demands have grown, already reaching pre-recession levels, driving prices up.
But Leopardo president Rick Mattioda says now is the time to pursue renovations and expansion plans. "For one thing, labor costs are not about to decline again, and will only continue to increase over the next few years, so sooner is better than later for new construction or renovation plans to be carried out." He also points out that interest rates are expected to go up later this year, which will affect project financing.
Another advantage is lower fuel costs, which have seen a significant 43.5% drop in the past year. "The operating costs associated with construction equipment and trucking will be reduced due to these lower fuel costs," Mattioda says.