• Residential construction worker wages are growing at a 5 percent annual pace, almost double the 2.9 percent pace of wage growth for all workers.

• As of March, the average U.S. residential construction wage nationwide was about 13.7 percent above the average private-sector wage.

• Residential construction wages have picked up a lot more than construction starts. If the residential construction labor market today resembled the residential construction labor market of the mid-2000s, the country likely would be seeing substantially more new home construction than it current is.

Wages have skyrocketed for construction workers since the start of last year, far outpacing the steady wage growth for all workers over the same period, as clear a signal as any of the depth of labor shortages home builders face as they struggle to ramp up building as their costs keep rising.

When demand for certain kinds of workers rises, wages for those workers most in demand also tend to rise. And clearly, the demand for skilled construction labor is incredibly high these days.

Wages for all private-sector workers have been steadily increasing since the start of last year, rising between 2.6 percent and 2.9 percent year-over-year, according to data from the U.S. Bureau of Labor Statistics. At the start of 2017, wages for construction-industry workers were growing slightly slower than wages for other workers – around 2.5 percent per year. But they are now growing 3.8 percent per year. The shift is even more pronounced for residential construction workers, in particular: Their wages were growing around 2.4 percent per year at the start of last year, but are now growing at a 5 percent annual pace.

Historically, average wages in the residential construction industry have been slightly higher than wages overall. In early 2006, at the height of the building boom, the ratio of residential construction wages to overall wages stood at approximately 1.16. A ratio of 1 would mean wages are the same in both sectors – so put another way, residential construction wages on the eve of the Great Recession were 16 percent higher on average than overall private wages.

But as construction activity plummeted during the recession, residential construction wages softened and converged toward overall wages, dropping to near parity by late 2011. Since then, though, the gap has widened considerably. As of March, the average U.S. residential construction wage nationwide was about 13.7 percent above the average private-sector wage – a gap on par with late-2006 levels.

It would make sense that as construction activity picked up during the recovery, residential construction wages would also rise to some extent. But residential construction wages have picked up a lot more than construction starts. If the residential construction labor market today resembled the residential construction labor market of the mid-2000s, the country likely would be seeing substantially more new home construction than it currently is.