The Future of Housing-Related Jobs

When you buy a new home, you're not just moving into a different neighborhood. You're injecting a dose of adrenaline into the heart of the American labor market. Think about it: Building a home requires architects to design plans, workers to hammer nails, and manufacturers to provide everything from lumber to bulldozing equipment. Purchasing a previously owned home also provides an employment jolt. By the time you sign the closing documents, you'll have created demand for real estate agents, lawyers, appraisers, inspectors, and mortgage lenders. And once you move in, you'll probably make a few more purchases, helping to support jobs for makers of carpets, home appliances, furniture, and other goods. "Look at it as a spider web," says Mike Larson of Weiss Research. "The real estate transaction is in the center, and then you have all of these ways that it reaches out into different parts of the economy."

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During the first half of the decade—when Americans purchased homes at a frantic pace—this arrangement worked out beautifully for job seekers. From 2001 to 2006, total mortgage industry employment surged by 83 percent, to nearly 500,000 positions. The tally of Realtors jumped by 66 percent, to roughly 1.3 million, and home-building employment increased by nearly a third, to more than 3.4 million. But as the boom turned to epic bust, real estate-related jobs evaporated even faster than they had appeared. The 1.3 million residential construction positions cut since February of 2006, for instance, represent about 22 percent of the entire net job reduction that occurred during this period. "We are at a low point with respect to employment in housing-related activity," says Mark Zandi, chief economist for Moody's Economy.com.

Despite this bloodletting, jobs related to real estate are expected to slowly re-emerge this year as the housing market flickers back to life. IHS Global Insight projects that housing starts will nearly triple by 2012, to about 1.6 million units annually, and total home sales will increase 29 percent, to almost 6.5 million. "People have to live somewhere," says IHS economist Patrick Newport. (It could be three to five years, however, before employment reaches pre-bubble levels.) But these new jobs won't be identical to those that preceded them, as shifting demands are already forcing workers in housing-related fields to develop new skills. Here's a look at the changing job descriptions for workers in three specific subsectors: home construction, real estate sales, and mortgage origination.

Home construction: In January, executives at Beazer Homes announced the company would take additional steps along its innovative path. The half-century-old builder had already committed to install a slew of high-performance features—programmable thermostats, fluorescent light bulbs, and more efficient dishwashers—into every home it built. But beginning that month, Atlanta-based Beazer pledged to make additional insulation and energy-efficient low-emissivity windows standard as well. The new features will enable Beazer to lower a buyer's energy costs by as much as 46 percent versus a comparable home built 10 to 15 years ago. And by leveraging its size—Beazer is among the nation's 10 largest builders—the company can implement such changes without raising prices.

[See also 10 Great 'Green' Home Improvements for 2010.]

The decision to devote more resources to so-called green building was driven by changing consumer demands, says Tony Callahan, Beazer's senior vice president for national purchasing, planning, and design. In addition to environmental concerns, the recession has forced many Americans to take a scalpel to their monthly expenses. "People are now looking at homeownership as more than a mortgage, taxes, and insurance," Callahan says. "You add utilities, and outside of that mortgage, the utilities could be their next-largest budgetary item." It's estimated that by 2012, green homes will represent as much as 20 percent of the new-home market, up sharply from just 2 percent in 2005. But building a green home can require skills that differ significantly from those used in traditional home construction, Callahan says. Green home builders, for example, take pains to create a tightly sealed thermal envelope inside the home. And given the direction the new-home market is heading, it's impera­tive for builders to obtain these green-building skills, Callahan says. "They are a cost of entry." Green home-building education programs offered through the National Association of Home Builders can help make workers more attractive to prospective employers.