Special Topic: The Construction Labor Shortage - What It Means for Eastern NC Homeowners Planning Projects
Thinking about building an ADU, renovating your home, or adding on? Here's what the national construction labor shortage means for your project timeline and budget in eastern North Carolina.
If you've noticed that contractors are busier than ever or that project timelines seem longer than they used to be, you're not imagining things. According to the Fall 2025 Construction Labor Market Report from the Home Builders Institute, the construction industry is facing a skilled labor shortage that costs $10.8 billion annually, with $2.7 billion in impact due to longer construction times and $8.1 billion from lost construction representing 19,000 homes that simply can't be built.
At Plank Construction, we're navigating these challenges daily while keeping projects on schedule and within budget. Understanding what's driving the labor shortage helps homeowners plan more realistic timelines and budgets for their eastern NC renovation and construction projects.
The Numbers Behind the Shortage
The construction industry currently employs 8.3 million payroll workers, with residential construction representing 3.3 million of this total. But here's the challenge: the industry needs approximately 723,000 new hires per year to maintain current activity levels and replace workers leaving the sector.
Over the last 12 months, home builders and remodelers lost 26,100 jobs despite ongoing housing demand. This isn't because people don't want to build – it's because finding skilled workers remains incredibly difficult.
What's Causing the Shortage?
The construction workforce has changed dramatically over the past two decades. The share of tradesmen declined from 71% in 2005 to under 61% in 2022, meaning the industry lost more than a million craftsmen. At the same time, the share of computer, engineering, and science occupations doubled, and management and business occupations increased 60%. This shift reflects changing building codes, more complex regulations, and evolving construction technologies. While we need more skilled tradespeople, the industry is also adapting to require more technical expertise.
The aging workforce compounds the challenge. The median age of construction workers is 42, with Baby Boomers still representing 14.2% of the construction labor force, meaning a substantial portion will retire in the near future.
Good News: Younger Workers Are Coming
There's encouraging news in the data. The share of Gen Z workers in construction more than doubled from 6.4% in 2019 to 14.1% in 2023, and millennials also increased their share from 35.7% to 37.7%. Younger generations are discovering that construction offers competitive wages, job security, and career growth potential without requiring expensive college degrees. This trend should help address long-term labor needs, though it doesn't solve immediate shortage challenges.
Wages Reflect the Shortage
The labor shortage drives wages higher, which ultimately affects project costs. Average hourly wages in construction decelerated to 3.7% annual growth but still exceed national private sector averages. More dramatically, home building non-supervisory workers' wages rose 9.2% in July, substantially outpacing inflation and wage growth for the overall sector. This reflects the acute shortage of skilled tradespeople doing the hands-on construction work.
The Role of Immigration
Immigrant workers now account for 25.5% of the construction workforce, a new historic high, with one in three craftsmen coming from outside the U.S. In eastern NC, like much of the South, Hispanics make up close to a third of the construction labor force at 32%, a record high share. These workers fill critical gaps in trades that face the most severe shortages, particularly in roles like drywall installation, roofing, painting, and carpentry.
Women in Construction: Growing but Still Underrepresented
Women make up a growing share of construction employment, reaching a 20-year high of 11.2% in 2024, a noticeable increase from 9.1% in 2017. Most women in construction work in office administration, management, and business operations rather than trades. Increasing women's participation in skilled trades represents an opportunity for addressing labor shortages, though cultural and practical barriers remain significant.
What This Means for Your Eastern NC Project
Understanding the labor shortage helps you plan more realistically for your home project:
Longer Timelines: Projects that once took 8 weeks might now take 10 to 12 weeks. The skilled labor shortage directly impacts construction times and increases carrying costs. Build extra time into your planning.
Higher Costs: Labor shortages drive wages higher, which increases overall project costs. Quality contractors charge appropriately for their expertise and the skilled workers they employ.
Importance of Planning: Well-planned projects with clear specifications and decisions made upfront minimize delays. Changes mid-construction become more expensive when skilled labor is scarce.
Value of Experience: Contractors with established relationships with skilled tradespeople complete projects more efficiently. Experience navigating labor shortages matters more than ever.
How Plank Construction Manages the Challenge
We've adapted our approach to ensure project success despite labor challenges. We maintain long-term relationships with skilled tradespeople who prioritize our projects because we treat them fairly and keep them consistently employed. We build realistic timelines into project planning rather than promising impossible completion dates that create stress for everyone. We never sacrifice quality to meet arbitrary deadlines – your project deserves skilled workmanship regardless of labor market conditions. And we keep clients informed about scheduling, potential delays, and how we're managing around labor availability challenges through clear communication.
Looking Forward
The construction labor shortage isn't disappearing overnight, but several trends offer hope. Federal Reserve interest rate cuts should increase construction demand and lift demand for construction labor as borrowing costs decrease and more homeowners pursue renovation and construction projects. The growing pipeline of younger workers entering construction trades should gradually ease shortages over the next decade. And while technology improvements and better productivity can partially offset labor shortages, construction fundamentally requires skilled human craftspeople.
Planning Your Project in This Environment
If you're considering an ADU, addition, or major renovation in eastern NC:
Start Planning Early: Give yourself extra lead time for both planning and execution. Projects that once took 6 months from concept to completion might now require 8 to 10 months.
Budget Realistically: Account for higher labor costs in your budget. Trying to find the cheapest contractor often results in delays, quality issues, or projects that never start.
Be Flexible: Some flexibility in timing and material selections helps contractors optimize schedules around labor availability.
Choose Experience: Work with contractors who have proven track records navigating labor challenges and maintaining quality despite market pressures.
The Bottom Line
The construction labor shortage is real and affects every project in eastern NC. Understanding these challenges helps you plan more effectively and set realistic expectations for your home improvement projects.
At Plank Construction, we're committed to delivering quality work on realistic timelines despite labor market challenges. Our experience, relationships with skilled tradespeople, and honest communication help ensure your project succeeds even in a difficult labor environment.
Ready to discuss your eastern NC construction project? Contact Plank Construction for a consultation that provides honest assessment of timelines, costs, and how we'll navigate labor challenges to deliver the results you want.
Plank Construction understands the construction labor market challenges affecting eastern North Carolina projects. Our established relationships with skilled tradespeople and realistic project planning ensure successful outcomes despite industry-wide labor shortages. Contact us today to discuss your project.