By Associated Builders and Contractors
The construction industry lost 7,000 jobs in August, according to an Associated Builders and Contractors analysis of data released by the U.S. Bureau of Labor Statistics. On a year-over-year basis, industry employment has grown by 58,000 jobs, an increase of 0.7%.
Nonresidential construction employment decreased by 1,200 positions on net, with losses in two of the three subcategories. Nonresidential building lost 3,300 jobs, while nonresidential specialty trade lost 200 positions. Heavy and civil engineering added 2,300 jobs for the month.
The construction unemployment rate dropped to 3.2% in August. Unemployment across all industries increased from 4.2% in July to 4.3% last month.
“The construction industry has now lost jobs in each of the past three months,” said ABC Chief Economist Anirban Basu. “Industrywide employment is up by just 6,000 positions since December, and every subsegment except for heavy and civil engineering lost jobs in August. Despite these job losses, construction labor shortages appear to be worsening as immigration policy weighs on the supply of workers; the construction unemployment rate fell to 3.2% in August, matching the lowest level ever recorded.
“Construction industry data have been particularly downbeat since March,” said Basu. “With materials prices rising and construction spending shrinking, it’s hardly a surprise that the industry’s workforce is contracting. Despite these troubling signs, contractors remain optimistic about their sales over the next six months, according to ABC’s Construction Confidence Index. While that may reflect the notion that weak labor market data will translate into accelerated rate cuts, there is no guarantee that a lower federal funds rate will translate into lower borrowing costs given the current state of the bond market.” (Source)