Taylor: How workforce housing affects the economy
When faced with both a workforce and housing shortage, the growth of New Hampshire businesses is severely tested
What if I told you that one of the most beloved Christmas movies of all time was about the community benefits of workforce housing? Before you say, “bah humbug,” hear me out.
Frank Capra’s “It’s a Wonderful Life” is a seasonal classic. While there are so many recognizable things about the story – Zuzu’s petals, Clarence the angel, the gym floor opening into the swimming pool, and George’s triumphant Christmas Eve run through town – there’s a theme that’s often overlooked about sleepy Bedford Falls.
George Bailey helps the people of his town by creating housing in Bailey Park. But when our hero wishes he “was never born,” Clarence shows him what his absence would have meant to Bedford Falls: The bucolic town has transformed into seedy Pottersville. The homes for residents in Bailey Park were never built. When George sees the richness of his life, he rushes back to find a thriving Bedford Falls.
This may not be what you see when you watch “It’s a Wonderful Life,” but a housing crunch is a serious threat to the economic vitality of any community. That’s why New Hampshire employers have been raising the alarm about lack of available housing – both rental and owned – for their employees.
With unemployment at less than 3 percent, and even lower in some places, New Hampshire businesses are struggling to retain experienced workers and find qualified candidates to fill open positions. Interwoven with the talent recruitment issue is that the supply of housing in the state is not keeping up with demand. Business owners can offer competitive salaries, generous benefits, and a welcoming workplace, but how are they supposed to convince prospective employees to work for them if they can’t find suitable housing within a reasonable commuting distance?
The outlook is troubling. Data from the NH Housing Finance Authority shows new homes in the Granite State only represent 7 percent of sales, when it had been 15 percent before the Great Recession. The rental vacancy rate is a mere 1.96 percent and the median gross rental cost has jumped 20 percent in the past five years.
A report from Applied Economic Research Inc. in Laconia finds an additional 3,000 rental units are needed to normalize vacancy rates, and an additional 20,000 homes and apartments are needed to meet the demand of New Hampshire’s labor market. Our limited housing supply is a challenge for recruitment and retention of employees, which will potentially impact economic growth and stability.
The good news is there are many developers willing to build new units priced for workers and alleviate some of the pressure. The bad news is many communities are putting up unnecessary roadblocks to construction of new houses and apartments.
The opposition is often predicated on myths about overcrowding school systems, attracting undesirable people, or urban sprawl. Statistics don’t support these myths, according to housing experts who advise the Business and Industry Association.
This January, BIA will be working to pass legislation establishing a state-level administrative housing appeals board (similar in concept to the state land and tax appeals board) to give developers the ability to appeal local zoning decisions that unfairly restrict housing development without having to endure the time and expense of suing in Superior Court.
Businesses want great employees and employees want affordable homes near where they work. When faced with both a workforce and housing shortage, the growth of New Hampshire businesses is severely tested. Collaboration among businesses, policymakers, and residents is critical to maintaining New Hampshire’s economic vitality into the future.
In the end, it’s not about whether heroes are ever born. It’s about whether affordable housing for working people is ever built. There is a whole new generation of residents we’re trying to keep in New Hampshire. Angels may not get their wings when workers find a suitable place to live, but a community grows stronger.
Thomas Taylor, president and CEO of Foxx Life Sciences, Salem, is on the board of directors of the Business and Industry Association of New Hampshire.