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Decline in Immigrant Labor Could Drive Up Construction Costs



By Christina Sturgis

A survey of housing experts by Zillow suggests that the decline in the population of immigrants in the country illegally may drive up housing prices because many of them find employment in construction and extraction, the drilling, boring, excavation and clearing debris required by major projects.

Among the Zillow panel of experts, made up of economists and researchers, 40 percent said they expected the demographic changes would push builders to favor luxury projects with higher profit margins to make up for the higher building costs.

About 43 percent of the respondents said a decline in the population of immigrants in the country illegally would result in more construction jobs for U.S. and foreign-born workers. More than 30 percent linked the population decline to lower inventory, and they predicted that construction of new homes would remain below historical norms.

Pew Research estimates there is a high share of undocumented immigrants in construction and extraction jobs — about 14 percent. The largest shares of undocumented workers are thought to be in farming, fishing and forestry (26 percent), and the cleaning and maintenance of buildings and grounds (17 percent).

The impact seems even more critical in Florida, because the housing market was hit especially hard by the Great Recession, and because there are more immigrants in the country illegally in Florida. The Pew Research Center on Hispanic Trends estimates there are 925,000 undocumented immigrants in Florida, or about 4.8 percent of the population. That percentage is fifth in the United States, behind Nevada (7.6 percent), California and Texas (6.3 percent), and New Jersey (5.8 percent).

The size of the population of immigrants in the country illegally peaked in 2007 at 12.2 million, or about 4 percent of the U.S. population, before declining to about 11.3 million, or 3.5 percent of the U.S. population, in 2014, according to Pew. About 49 percent of the undocumented population is Mexican, but their numbers started dropping off as the U.S. economy began struggling around 2007.

Undocumented Immigration May Affect the Housing Market
Many Hispanics View Homeownership as Key to the American Dream
The Home Buyers’ Guide to New Construction

[Last modified: Wednesday, August 31, 2016 3:00pm]


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