The pandemic has affected different sectors of the economy in all kinds of different ways. The housing market in Northern Nevada continues to boom. And the construction industry is trying to keep up.
"We were already behind the eight ball in terms of trying to provide enough housing, and this has just exacerbated that problem," said Aaron West, CEO of the Nevada Builders Alliance. "So all the businesses coming in from California, the employees necessary, the folks that are allowed to work remotely, why would they stay in the Bay Area and pay those kinds of prices when they can come over to Reno? It's more beautiful, it's cheaper, and so it's just been absolutely crazy. It's considerably higher than pre-pandemic on the demand side, which has created another set of issues."
Issues like labor.
"We have had a labor shortage within the construction industry for years," West said. "We had a whole generation during the last downturn where there wasn't a lot of construction activity, so we lost a whole generation of workforce."
There's also the issue of materials.
"Even though construction was deemed essential and allowed to continue, all the manufacturing processes that the construction industry relies on were not," West said. "So they were shut down. That's what's driving issue with lumber availability - there's been a 400% increase in lumber prices because of lack of availability. Steel prices are up over 60% in the last year"
And, the issue of space.
"We're running out of places to actually build houses," West said. "And it's kind of a twofold problem. One is, it's really driven by the fact we have a lot of folks coming into the area and they almost feel like I'm here now, you can go ahead and close the doors, the typical 'not in my backyard' crowd. And unfortunately, that's really driving a lot of the conversation with the elected officials in these communities that say, there's so much resistance from these folks, these are voting members of our community, I don't want to upset them too much. But at the same time, we need lots to in order to build on. So entitlement processes that used to take 12-18 months are now taking 4-5 years. So very quickly the biggest issue in the industry right now, especially in Northern Nevada, is the availability of lots to actually build houses on."
An upside to this, he says, is there are plenty of job opportunities in the industry right now.
"I think it's one of the big things when we talk to young people," West said. "Too often, construction is viewed as just swinging a hammer or working a shovel and now it's so much more skilled, we have so much more than is done with equipment, with technology, and I certainly think it's something that will appeal to a younger audience and hopefully get them engaged,"
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