Allow me a personal note on my last column for BUILDER. As the chief economist at NAHB, I have had the the privilege of speaking to you for the past eight years. Working for and in the home building industry is a high honor and an amazing opportunity. My economist career began at HUD 40 years ago, but fortunately led me to NAHB for the past 27 years.
What's so special about housing? The industry provides shelter to Americans. The 135 million U.S. home were built primarily by home builders. The industry is dominated by family-owned, small home builders often passed down through generations and involving every family member. The industry just went through the worst depression since the 1930s, and while many firms disappeared, the stronger, wiser, perhaps more conservative, companies did survive.
The average home builder employs 11 people, but the average is boosted by the relatively few very large firms. The median-sized firm employs four and builds five homes per year. The industry is truly dominated by small businesses run by smart, energetic individuals. The proprietor is a jack-of-all-trades who must balance customer desires with labor and material abilities, schedule a multitude of operations often in alien environments, and manage a firm with significant liabilities and not many assets.
Home building extends beyond the individual who assembles the many subcontractors and services to those very subcontractors, suppliers, professional services and advisers who provide the builder the incredible variety of goods and expertise needed to create a complicated and many-phased project called a home. And those firms and individuals who keep homes current and sometimes move back and forth between builder and remodeler are also part of the home building industry.
Residential construction activity, including remodeling, topped $400 billion in 2015 and accounted for half of all private construction in the U.S. Home building accounts for 3.2% of the total economy, up from 2.5% at its worst but still not back up to the historical average of 5.2%.
Every single-family home built provides the equivalent of three full-time jobs for a year. About half of that work is the on-sit construction performed by carpenters, electricians, plumbers, installers, and so forth. The other half usually is not accounted for in residential construction totals, but is equally essential. Those workers sell and deliver building materials, make the products that are installed in homes, finance the construction and purchase, and so on. Jobs in the industries that supply home building are just as many as the on-site workers. About 2.5 millions workers are ascribe directly to home buildings, which means there are roughly another 1.5 million outside residential construction, but directly supported home building for a total of 5 millions jobs directly connected to building houses.
So, it can't get any better than working in a job that leads some of the smartest and hardest-working economies in the country for an industry so vitally important to the economy. Working for the industry means working on critical policy issues affecting home build, such as tax policy that helps young families buy a homes, reform that keeps mortgage money flowing with minimum risk to the the taxpayer. Working for the industry means meeting with top policymakers in the legislative and regulatory branches. It means testifying before Congress, explaining impacts to senators and representatives. It means people listed!
But much more rewarding than the heady dealings in Washington D.C., is working with smart, hardworking, and hard-charging individuals who run home building companies and the companies supporting residential construction. The members of the NAHB and the staff that support them at national headquarters and in the local associations are family. We celebrate together and we knuckle down and push together toward goals meant to make housing more affordable and available to every American. We relish the time and energy we spend together to accomplish our goals.
This is the part I will miss the most, but we all get only so much time; now is the time for me to enjoy the rest of my love of life.