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June 7, 2024 - 12:40pm

According to data released today by the US Bureau of Labor Statistics, the national construction industry added 21,000 jobs on net in May.

Key Takeaways

Press Release from Associated Builders and Contractors, Inc (ABC)

ABC: Nonresidential Construction Adds 17,100 Jobs in May

WASHINGTON, June 7—The construction industry added 21,000 jobs on net in May, according to an Associated Builders and Contractors analysis of data released today by the U.S. Bureau of Labor Statistics. On a year-over-year basis, industry employment has increased by 251,000 jobs, an increase of 3.1%.

Nonresidential construction employment increased by 17,100 positions on net in May, with growth registered in all three major subcategories. Nonresidential specialty trade added the most jobs, with employment increasing by 13,000 positions. Nonresidential building and heavy and civil engineering added 3,000 and 1,100 jobs, respectively.

The construction unemployment rate fell to 3.9% in May. Unemployment across all industries rose from 3.9% in April to 4.0% last month.

"Every monthly employment report is important," said ABC Chief Economist Anirban Basu. "But this year’s reports are scrutinized carefully for several reasons, including upcoming federal elections. Economists are asking whether indications of softening in certain parts of the economy might cause deterioration in the overall labor market and whether the virtuous cycle of consumer spending and job growth will persist. May’s report indicates that we remain in that virtuous cycle."

"Despite perpetual fears of recession and the dislocating impacts of high borrowing costs, the U.S. nonresidential construction industry is adding jobs rapidly and will continue to, according to ABC’s Contractor Confidence Index," said Basu. "While many would point to public infrastructure outlays as an obvious source of strength, this report indicates job growth among many industry segments. The rapid transformation of the U.S. economy continues to more than offset the negative impacts of elevated project financing costs."

"As always, the news was not purely positive," said Basu. "Wage pressures picked up in May, likely quashing hopes for a Federal Reserve rate cut in July. While the establishment survey indicated that the nation added 272,000 jobs in May on a seasonally adjusted basis, blowing through consensus expectations, the household survey indicated that the nation’s unemployment rate increased despite a shrinking U.S.  labor force. What that means is that the headline job growth number emerging from the establishment survey may be overstating U.S. economic strength while also delaying the Federal Reserve’s response to potentially emerging economic weakness."


 

Press Release from Associated General Contractors of America (AGC)

Construction Employment Increases By 21,000 Between April And May With Job Gains At Both Nonresidential And Residential Construction Firms

Despite Job Growth That Outpaces Total Nonfarm Employment Gains, Contractors Continue to Struggle With Shortages of Skilled Workers to Build Data Centers, Factories, Power, and Infrastructure Projects

The construction industry added 21,000 jobs in May and 251,000 jobs over the past year, with increases at both nonresidential and residential construction firms, according to an analysis of new government data the Associated General Contractors of America released today. Association officials noted that nonresidential contractors report continuing difficulty filling positions despite the job gains, and they urged government officials to boost support for career development and allow more employment-based immigration.

“Construction firms have been adding workers at a faster clip than most sectors,” said Ken Simonson, the association’s chief economist. “But contractors say they are still having trouble finding enough skilled workers to meet the demand for data centers, manufacturing plants, renewable energy, and infrastructure projects.”  

Construction employment in May totaled 8,228,000, seasonally adjusted, a gain of 21,000 from April. Residential construction firms—homebuilders and specialty trade contractors—added 3,500 employees. The three types of nonresidential contractors added a total of 17,100 employees: 3,000 at nonresidential builders, 13,000 at nonresidential specialty trade contractors, and 1,100 at heavy and civil engineering construction firms.

The industry added 251,000 jobs between May 2023 and last month, an increase of 3.1 percent. Employment at nonresidential construction firms rose by 179,000 or 3.8 percent, more than double the 1.8 percent increase in total nonfarm employment. Residential construction employment increased by 71,900 or 2.2 percent.

Average hourly earnings for production and nonsupervisory employees in construction—covering most onsite craft workers as well as many office workers—climbed by 4.3 percent over the year to $35.45 per hour. Construction firms in April provided a wage “premium” of 18.2 percent compared to the $29.99 average hourly earnings for all private-sector production employees.

Association officials said nonresidential contractors are still having difficulty finding enough workers to execute projects on time. They urged government officials at all levels to put more resources into education and training programs for fields like construction. They also called again on Congress and the Biden administration to allow construction firms to sponsor qualified foreign workers to ease critical shortages of skilled crafts.

“Current immigration policy and inadequate funding levels for career and technical education programs mean the federal government is preventing many construction firms from meeting the demand for building infrastructure, renewable energy facilities, and advanced manufacturing plants,” said Jeffrey Shoaf, the association’s chief executive officer. “It is essential that the government make an all-out commitment to measures that can enable contractors to obtain the skilled workforce required to deliver vitally needed projects.”

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