b"THE OFFICIAL NFBA MAGAZINEhigher than the historic average of 2.5% to 3.0%.ProblemNo.2isascarcityofworkers.Based onsurveydata,thenumberoneissuefor construction firms continues to be the inadequate supply of skilled workers, said Basu. Thats not just a function of the fact that the U.S. economy continuestogrowandgaspricesstabilize. came screaming out of the pandemic in the form of a V-shape recovery. Its a long term, structural, Animpressivelevelofaccumulateddebt,demographicissuethattranscendsbusiness ECONOMIC UPDATEthough,ishanginglikeadarkcloudoverthecycles. America simply does not produce enough consumer landscape. With credit card debt nowskilledcraftspeople,andthisimpactsvarious aboveatrilliondollarswithmoreconsumersindustries,whetherenergy,manufacturing, havingtostartpayingbackstudentloanslogistics,orofcourse,construction.Inthe andwithevidenceofslowinglabormarketsabsenceofverydeepeconomicdownturns, becomingmorepervasive,there'severyreasoncontractorswillcontinuetobescrambling tobelievethatthepaceofconsumeroutlayfortalentandthatwillpushwageshigher.growthwillsoftengoingforward,saidBasu.While employers never like having to raise wages, Fortheimmediatefuturethough,consumerputting a cap on paychecks has taken a back seat confidenceseemssecure,dueprimarilytothe to a more urgent concern: keeping valuable talent healthy job market. The unemployment rate hasfrom jumping ship. The big question now is not beenverylow,bouncingaroundbetween3.5%somuchwhocanpaythemostforentry-level and 3.8% for some time, said Hoyt. A slowdownand skilled jobs, but what can they do to retain in job growth orchestrated by the Federal Reservesthese folks within their companies, said Palisin. interestratehikesshouldmoderatethings.WeManufacturing in the US over the last year has thinkunemploymentwilltrendupwardabit,continuedtohireprettysignificantly,andwere ending 2023 around 3.9% and 2024 around 4.2%.not seeing a lot of layoffs, so that tells you that (Many economists peg an unemployment rate ofmany companies are hoarding talent. Employers 3.5% to 4.5% as the sweet spot that balances thearefinetoolingtheiroperationsintheareasof risks of wage escalation and economic recession.) workplace flexibility, benefits, and culture changes.LowunemploymentmayfuelhappysentimentsHousing marketsamong citizens, but it presents employers with twoGiven the generally upbeat consumer sentiment, practical challenges. The first is the need to raiseprospectsaregoodforthehousingsector,an wagestoattractsufficientworkers.Wageandimportantdriveroftheoveralleconomy.New salary income growth has been strong, fueled byhome sales are running at the top end of the range set a tight labor market, said Hoyt. We're expectingin the decade preceding the pandemic, said Yaros. it to increase just a shade over 5% both for 2023One reason is that a lack of existing inventory and 2024. In 2022 the growth was a little over 8%. ispushingbuyerstoconsidernewhomes.The Reinforcingtheestimatesoftheeconomists,construction industry is stepping in to close the gap, Palisin said his members have had to hike theirandhousingstartshaveexceededexpectations.compensationtoremaincompetitiveamongTheconstructionofnewhomesisbeingfueled themselvesandothereconomicsectors.Theby a cold hard fact: There arent enough existing groups entry level hourly wages increased an eye- homes to meet demand. The 3.1 months supply of popping 8% to 10% in both 2022 and 2023, far 32 / FRAME BUILDER - NOV2023"