The US building and construction industry is bracing for a one-two punch with Trump’s immigration policies and tariff plans, which will lead to a labour shortage and cost blowouts for America’s lukewarm housing market. That is according to a new report by the Pew Research Center and the Harvard Joint Center for Housing Studies, which warned that undocumented workers account for more than 13% of the US construction industry—with that proportion ballooning out to more than 50% in California and Texas alone.
It comes as the Wall Street Journal (WSJ) reported that several economists and a cross-section of the country’s largest builders caution that mass deportations will lead to significant work shortages, drive up wages and disrupt projects. A study published by the University of Utah and the University of Wisconsin found that the deportation of over 300,000 undocumented immigrants between 2008 and 2013 left many construction positions unfilled, which in turn resulted in a year’s worth of construction loss in the average county and a 20% rise in new dwelling prices.
The concerns of mass deportations come as Wood Central revealed that the prices of 2 x 4 lumber and mass timber imports would rise from the first day of Trump’s presidency after the president-elect vowed to slap a 25% tariff on Canadian goods (above the current 14.54% tariff on softwood lumber) as part of a push to address “drugs and crime” crossing the border.
During Trump’s previous administration, concerns over tariffs and timber supply led many to consider ramping up domestic manufacturing—including cross-laminated timber and glulam—to help fuel the United States’ new wave of mass timber projects. More than 2,000 mass timber projects have been built or are in various stages of development across the US. However, the mass timber industry in the US is “still in its infancy,” according to Pat Jolley, a product manager for Forisk Consulting. “But, it remains to be seen how the new trade policy impacts its growth.”
- To learn why demand in the United States housing industry is sluggish, click here for Wood Central’s special feature from June. To learn more about Trump’s policy on housing, click here for Wood Central’s election article from October.
