Over the past 12 months, the cost to multifamily developers of compensating their employees increased by an average of nearly 12 percent, according to results from NAHB’s latest Multifamily Market Survey (MMS).
The first quarter 2022 MMS, sent electronically to a panel of multifamily developers on April 12, included a special question on how much compensation costs have increased for nine specific job categories. At the top of the list, the cost of compensating senior project managers increased by an average of 14.8 percent over the past 12 months, followed by the costs of compensating construction superintendents or supervisors (14.3 percent) project managers (12.6 percent), and project engineers (11.9 percent). Even costs for the job least affected by wage inflation among the nine listed, leasing managers or agents, increased by 9.4 percent.
Averaged across all nine job categories listed in the survey, costs of compensating the employees of multifamily developers increased by 11.9 percent over the past 12 months. This is considerably higher than the 4.5 percent year-over-year increase in compensation costs for all civilian workers recently reported by the U.S. Bureau of Labor Statistics. Along with other factors like the 19.2 percent year-over-year increase in the cost of building materials, it demonstrates why it can be difficult to build new housing at the affordable end of the spectrum.
Definitions of the nine job categories covered in the first quarter MMS survey are shown below:
Project Executive—Multifamily production professional overseeing several Project Managers, similar to a Senior Project Manager noted below
Senior project manager—On-site senior project manager overseeing a development project or Not on-site and responsible for one or more multifamily construction projects with oversight of on-site production team
Project manager—On-site project manager for a development project or Not located on-site, but Overseeing Construction Superintendents
Construction Superintendent/Supervisor—manager overseeing a development project for a construction management entity
Project engineer—Entry level construction manager for a development project or Entry level aspiring Project Manager or Preconstruction Manager
Property manager—Manager overseeing property management and leasing
Maintenance supervisor—Supervisor overseeing maintenance of building and equipment, Maintenance Techs, maintenance of apartment communities, capital improvements, unit turns and general maintenance.
Maintenance tech—Technician maintaining mechanical, electrical, plumbing, etc. A Maintenance Tech is an unskilled or minimally skilled entry level maintenance person learning the trade.
Leasing manager/agent—Staff marketing to and interfacing with prospective tenants.