Op-Ed: Housing is key to attracting Kentucky’s future workforce

The following is a comment written by the President and CEO of the Kentucky Chamber of Commerce Ashli ​​WattsHomebuilders Association of Kentucky CEO / EVP Aneta Sanfordand CEO of the Kentucky Realtors Association josh summer

One of the pillars of the “American Dream” is buying a home, an investment that allows you to put down roots, raise a family, and create memories. Home ownership has been proven to have long-term financial benefits, not just for the buyer but for our wider economy. In 2021, the housing industry contributed over $33 billion to our state’s economic impact, representing 14.3% of the state’s gross product.

In recent years, however, that part of the American dream has not been so easy to achieve.

If you’re a real estate agent, chances are you’ve never seen real estate prices rise so quickly or had trouble finding inventory as they have in recent years. If you’re a home builder, you’re probably trying to keep up with demand while struggling with inflated construction prices and backlogs in the supply chain. And if you’re a business looking to relocate to Kentucky, you’re probably thinking about how to recruit workers to Kentucky, knowing that housing options are limited.

These examples brought our groups together to work together to find solutions to the current housing crisis we are facing in Kentucky. Not enough housing is available — particularly affordable housing — and this poses a significant threat to Kentucky’s economic prospects. (And to be clear, this isn’t just limited to the Commonwealth, it’s the entire United States.) But how have we gotten to this point?

We don’t have to look too far back to find the answer. Simple economics of supply and demand have brought us to this point. After the last recession in 2008, supply simply did not keep pace with demand or budget formation. In fact, fewer new homes were built after the Great Recession than at any time in the past 50 years. A low supply of homes coupled with record low interest rates in the wake of the COVID-19 pandemic has brought us to this point.

Knowing we can’t go back and fix this problem, how can we improve our situation in the future? Time is of the essence as Kentucky has seen record-breaking investments in economic development; and with big employers like Ford locating huge new projects in the Commonwealth, we need to create an environment conducive to recruitment, which includes having quality housing options.

First, we must remove unnecessary obstacles to house building. We know that 120 counties in Kentucky have layers of onerous zoning restrictions and regulations that change from community to community – all of which have resulted in inflated costs and halted production. We need policymakers, from the city and county levels to our General Assembly and Congress, to continue to work together to eliminate excessive bureaucracy and facilitate the construction of much-needed homes.

All housing construction must comply with building codes and it is important that we work with our related industries to avoid exceeding building codes that are driving up housing costs and work towards safe and cost-effective regulations.

And while every industry faces labor shortages, we must act to attract more students into the construction profession. The need for skilled workers has never been as high as it is today. Carpentry, heating, electrical and welding jobs are in high demand for all aspects of living. We need to better promote our innovative trades and trade schools and the exciting (high-paying) opportunities they can offer Kentucky residents.

While we cannot solve this problem overnight, it is important that we all work together to find ways to find affordable housing opportunities for Kentuckians and those we hope will settle in our Commonwealth to work, to live and raise their families. It is critical to Kentucky’s future that we all work together to put the American dream back within reach.