The National Association of Home Builders (NAHB) has conducted an annual census of its members every year since 2008. Data from the census allow NAHB to construct detailed profiles of particular types of members, shedding light on the composition and characteristics of its membership.
This article updates previous studies with results from the 2019 annual census on the characteristics of NAHB’s associate members. Associate members are involved in a wide range of support industries and professions including, among others, trade contractors, manufacturers, retailers/distributors, designers, and architects. Builder members are defined as those whose primary business is single-family home building, multifamily building, residential or commercial remodeling, commercial building, land development, or the manufacturing of modular/panelized/log homes. At the end of 2019, 80,000 associate members represented 68 percent of the total NAHB membership. Builder members make up the remaining 32 percent and an article highlighting them will be published next month on housingeconomics.com.
43% of Associate Members are Subcontractors/Specialty Trade Contractors
Associate members could self-identify as one of 42 specialties when selecting a primary activity. These activities are grouped into 6 broader categories: 43 percent of associate members are subcontractors/specialty trade contractors, 13 percent have a professional specialty, 11 percent are retail dealers/distributors, 8 percent work in financial services, and 4 percent are wholesale dealers/distributors. Twenty percent of members listed some ‘other associate’ activity as their primary business activity (Exhibit 1).
The share of associate members primarily involved in ‘other subcontracting’ grew from 9 percent in 2018 to 11 percent in 2019, while the remaining 41 categories shifted by 1 percentage point or less during the same period (Exhibit 2). Grouping the activities into the broader categories shows that the share primarily involved in subcontracting/specialty trade contracting rose from 40 percent in 2018 to 43 percent in 2019, while the share involved in financial services fell from 10 percent to 8 percent. The remaining broader categories shifted by 1 percentage point or less from 2018 to 2019.
50% of Associates Have 10 or More Employees
In 2019, associate members had a median of 10 employees on payroll. The median number of employees has been in the territory of 10 or 11 since 2015. Eight percent of associate members had 1 employee, 19 percent had 2 to 4 employees, 22 percent had 5 to 9, 35 percent had 10 to 49, 6 percent had 50 to 99 employees, and 9 percent had 100 or more employees. Two percent had no payroll at all (Exhibit 3).
The median number of employees on an associate member’s payroll varies significantly by the company’s primary activity. For example, wholesale dealership/distributorships had a median of 20 paid employees in 2019, compared to a median of 8 employees among those involved in both the professional specialties and other associate activities, 9 among subcontractors/specialty trade contractors, 11 among retail dealerships/distributorships, and 19 among those involved in financial services.
Median Dollar Volume Falls in 2019
The median dollar volume of associate members was $2.2 million in 2019, down from a median of $2.5 million in 2018. Twenty-five percent of associate members reported a 2019 dollar volume of less than $500,000, 15 percent reported between $500,000 and $999,999, 32 percent between $1.0 million and $4.9 million, 9 percent between $5.0 million and $9.9 million, 5 percent between $10.0 million and $14.9 million, and 13 percent reported their dollar volume in 2019 at $15.0 million or more. One percent of associate members reported no business activity in 2019 (Exhibits 4 & 5).
Median dollar volume also varies widely across primary activity categories. For example, financial service members reported a median of $8.7 million in 2019 dollar volume, compared to $1.0 million for professional specialty members, $1.3 million for subcontractor/specialty trade contractor members, $1.8 million for members involved in some other associate activity, $3.6 million for retail dealership/distributorship members, and $8.0 million for wholesale dealerships/distributorships.
Age, Gender, Race and Ethnicity
The median age of NAHB associate members in 2019 was 56 years. Five percent of associate members were less than 35 years old, 16 percent were 35 to 44, 26 percent were 45 to 54, 35 percent were 55 to 64, and 17 percent were 65 or older (Exhibit 6). The median age of associate members has increased over time: it was 50 in 2008, 54 by 2012, and 56 by 2017 (Exhibit 7).
Twenty-three percent of NAHB’s associate members are women, the highest percentage since the inception of the Member Census in 2008 (Exhibit 8). The female share stood at 18 percent every year from 2009 through 2012, then increased to 19 percent in 2013, to 20 percent between 2014 and 2016, followed by consecutive increases in each of the past three years: 21 percent in 2017, 22 percent in 2018, and 23 percent in 2019.
The vast majority of NAHB’s associate members are White. In fact, 96 percent of associate members identified themselves as White, alone; while only 1 percent identified themselves as Black or African-American, alone; and less than a half of a percent each identified themselves as American Indian or Alaska Native, alone; Asian, alone; and Pacific Islander, alone. One percent of associates identified themselves as having two or more races and 2 percent identified themselves as belonging to some ‘other race’ (Exhibit 9). In terms of ethnicity, only 4 percent of associates are of Hispanic, Latino, or Spanish origin (Exhibit 10).
*Less than 0.5 percent reported being either American Indian or Alaska Native, alone; Asian, alone; and Pacific Islander, alone.
53% of Associate Members Have a Bachelor’s Degree or Higher
Since 2008, the share of NAHB associate members with a college or advanced degree has been at or above 50 percent. In 2019, 2 percent reported that they did not finish high school. Fourteen percent completed high school, 7 percent have career technical training, 25 percent have had some college education, 40 percent finished college, and 13 percent have an advanced/graduate degree (Exhibit 11).
The share of associate members with a college or graduate degree varies across companies’ primary activities. Eighty-two percent of professional specialty members have a degree, compared to 36 percent of subcontractor/specialty trade contractors, 46 percent of retail dealership/distributorship members, 60 percent of members involved in some other associate activity, 61 percent of wholesale dealership/distributorship members, and 74 percent of members in financial services.
Half Have Been Members for a Decade or More
In 2019, associate members reported belonging to NAHB for a median of 10 years, unchanged since 2015. Twenty-six percent have been members for less than 3 years, 24 percent for 3 to 9 years, 22 percent for 10 to 19 years, and 28 percent for 20 years or more (Exhibit 12).
Members primarily involved in financial services, retail dealerships/distributorships, and wholesale dealerships/distributorships have been NAHB members the longest, with a median tenure of 10 years, compared to a median of 7 years among members involved in other associate activities, 8 years among professional specialty members, and 9 years among subcontractors/specialty trade contractors.
A profile for each category of associate member is available in the “Additional Resources” box at the top of this article.
This article will use median values, as averages can be inflated by large companies. Medians are largely unaffected by these outliers because it calculates the middle most value, not taking into account how high the highest values are. An increase in a median’s value indicates an overall shift of all the associate members, not a change in a few large associate members.
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