Residential Building Wages Grow at Unprecedented Rate
Wages for residential building workers grew at a fast pace of 9.9% in September, following a robust 10.8% gain in August. These year-over-year growth rates in the past four months were unprecedented in the history of the data series since 1990. After a 0.3% increase in June 2023, the YOY growth rate for residential building worker wages has been trending higher over the past year.
The ongoing skilled labor shortage in the construction labor market and lingering inflation impacts account for the recent acceleration in wage growth. However, the demand for construction labor remained weaker than a year ago.
As noted in the latest Eye on Housing JOLTS blog, the number of open construction sector jobs fell from a revised 328,000 in August to a softer 288,000 in September. Nonetheless, the ongoing skilled labor shortage continues to challenge the construction sector.
According to the Bureau of Labor Statistics report, average hourly earnings for residential building workers1 was $33.51 per hour in September 2024, increasing 9.9% from $30.50 per hour a year ago. This was 19.2% higher than the manufacturing’s average hourly earnings of $28.12 per hour, 14.7% higher than transportation and warehousing ($29.21 per hour), and 8.1% lower than mining and logging ($36.46 per hour).
1Data used in this post relate to production and nonsupervisory workers in the residential building industry. This group accounts for approximately two-thirds of the total employment of the residential building industry.