For the past year, raw material prices have decreased considerably due to a worldwide decrease in demand for commodities. These now less expensive raw materials, which include iron, steel, asphalt, and diesel, have unfortunately not benefited the construction industry as most people might predict. Instead, as a result of historically low employment in the construction sector, many companies have struggled with increased labor costs. Employment within construction in Los Angeles and Phoenix dropped substantially over the past decade. Since, these two cities represent hubs for the construction, it can be extrapolated that the industry as a whole has experienced these dramatic changes as well.
Multiple factors have caused the shortage of construction labor prevalent today. Most notably, aging and immigration have contributed significantly. The percentage of construction labor aged below 25 is at a low. As a result, there is a shortage of construction workers to replace those who are constantly retiring. Altogether, these trends pose many issues to solve for the construction industry. Fortunately, many companies have revised their strategies, especially in terms of improving work conditions, in order to attract the high skilled labor that their intensive projects demand.