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Houston’s Severe Shortage of Construction Workers: A Bonanza for Blue-Collar U.S. Workers?

Shortage of construction workers to rebuild Houston could reshape regional labor market.

Even as much of Houston remains flooded from Tropical Storm Harvey, city officials are worrying that there may be a severe shortage of workers to clear and rebuild the area.

Tens of thousands of structures have been damaged or destroyed by floodwaters. Houston will soon need a massive effort in cleanup, demolition, and reconstruction of homes, office buildings, schools, hospitals and other basic infrastructure.

The timing couldn’t be worse for a city lacking human resources. It takes a tremendous amount of labor to clear debris after a storm and then reinstall sheetrock and drywall, rebuild floors, and repair electrical and plumbing systems. That kind of work is resistant to automation. And it is but one way in which Houston, which was already poorly equipped to deal with a hurricane, may also be poorly situated to recover from it.

The problem is that the U.S. is already suffering from a shortage of workers with the requisite skills to carry out disaster recovery.

Here are some fact. The U.S. economy has been creating jobs for a record 82 months, with 146.6 million people now on payroll jobs. The unemployment rate is down to 4.3%. At the end of July, the Labor Department reports, there were a record 6.16 million American job openings (That compares with about 4 million in 2005, when Katrina hit.) In short, it’s tougher to find labor in the U.S. right now than at nearly any other point in recent history.

But that’s only half the story. There are pronounced shortages in the kinds of trades that come in for the repairs after a disaster. America’s construction labor force has undergone a massive restructuring over the past decade. When the housing bust hit in 2007, hundreds of thousands of roofers and other skilled and unskilled tradespeople were laid off. Since the recovery was especially slow, many of those workers moved into different industries. A large number of construction workers had come to the U.S. (legally and illegally) from Mexico and Central America to work in the boom years, but after the recession hit, many returned home. Others have been deported. And over the past two years, the flow of new potential workers has markedly slowed. As a result, while the U.S. housing and construction recovery has plugged along, it has gotten increasingly difficult to hire construction workers. This summer, for example, there were some 225,000 open construction jobs in the U.S., up a whopping 31% from the previous year.

All over the U.S., in Colorado, Nebraska, and elsewhere, construction companies have been expressing concern that they can’t find enough labor to do their job. The National Association of Home Builders said that 77% of builders are experiencing a shortage of framing crews while 64% report a shortage of drywall installer and 45% are facing a shortage of weatherization workers. The problem is especially bad in Texas, where the housing industry has been supercharged by unprecedented population and job growth, and where the service industry is disproportionately reliant on immigrant labor. This past fall, the Wall Street Journal reported, “In Dallas, the King of Texas Roofing Co. says it has turned down $20 million worth of projects in the past two years because it doesn’t have enough workers.”

When natural disasters strike, first responders and recovery crews come pouring into the region for temporary work. But reconstruction, cleanup, and recovery requires many thousands of workers who can stay for months or even years. FEMA Official Brock Long told CNN that “FEMA is going to be there for years.” Houston needs a significant and lasting surge of employment—tens of thousands of people. Those workers will also need places to live, a major challenge with so much of the housing stock already damaged. Moreover, it will probably have to pay above-market wages in order to lure those workers away from their existing jobs and lives.

Given recent efforts to ramp up deportations, it’s not likely that what worked in past U.S. disasters will work again. Back in 2007, the Washington Post reported that found some 100,000 Hispanic workers poured into the Gulf Coast region for rebuilding efforts after Katrina – a significant number of them undocumented.

Houston is going to need a similar migration for it to rebuild and recover. In 2017, from where will it get those workers?

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Emery Reddy