The recovery in the housing market is driving a turnaround in the labor market as well.
The better-than-expected February jobs report got a big lift from 48,000 new jobs in the construction industry. Builders have added 151,000 jobs over the last five months, the sector’s best hiring surge since the 2006 housing bubble.
The employment numbers reiterate what other housing reports have found: Home prices are up, as are home sales. Near record low mortgage rates and a drop in foreclosures have created a much better market for builders. In January, they filed for the greatest number of building permits since 2008.
“Our members are hiring so much that they’re starting to get worried about finding enough labor out there,” said Paul Emrath, economist with the National Association of Home Builders. “Most are talking about adding people.”
He said his group’s forecast is that residential construction hiring in 2013 will be about five times the pace of last year.
Employment levels in construction are still very low compared to not just the housing boom years but also to employment even before the bubble started to inflate. The industry would have to add about 1 million workers overall to return to levels seen in early 2003.
“We are coming from a very, very low trough,” said Emrath. So many workers left the field during the downturn, that it’s become more difficult to find skilled construction workers, he said.
The jobs report also showed a pick-up in real estate hiring, as that sector added 13,400 over the last three months, the best three-month rush of hiring in the sector in seven years. Building supply stores also added 4,300 workers in February, making it one of the hottest retail segments to add workers.