According to data released today by the US Bureau of Labor Statistics, the national construction industry gained 23,000 jobs on net in June.
Key Takeaways
- The construction industry gained 23,000 jobs on net in June. Year-over-year, industry employment has risen by 198,000 jobs.
- Nonresidential construction employment increased by 12,200 positions on net, with gains in two of the three subcategories.
- "Theory suggests that the roughly 500-basis point increase in the federal funds rate over the past year would weigh on the demand for construction workers, yet the industry continues to add thousands of jobs each month. Contractors have collectively added jobs in 15 of the past 16 months, and ABC’s Construction Confidence Index suggests they will continue to increase staffing levels through the remainder of the year."
Press Release from Associated Builders and Contractors, Inc (ABC)
Construction Employment Increased by 23,000 in June, Says ABC
WASHINGTON, July 7—Construction industry employment increased by 23,000 in June, according to an Associated Builders and Contractors analysis of data released today by the U.S. Bureau of Labor Statistics. Industry employment has risen by 198,000 jobs since June 2022, an increase of 2.6%, to 7.947 million.
Nonresidential construction employment rose by 12,200 positions on net, with positive growth in two of the three subcategories. Heavy and civil engineering added 7,300 positions, while nonresidential building added an additional 5,400 jobs. Nonresidential specialty trade contractors lost 500 jobs on net.
The construction unemployment rate increased to 3.6%. Unemployment across all industries decreased from 3.7% in May to 3.6% in June.
"Theory suggests that the roughly 500-basis point increase in the federal funds rate over the past year would weigh on the demand for construction workers, yet the industry continues to add thousands of jobs each month," said ABC Chief Economist Anirban Basu. "Contractors have collectively added jobs in 15 of the past 16 months, and ABC’s Construction Confidence Index suggests they will continue to increase staffing levels through the remainder of the year."
"The June jobs report, along with yesterday’s JOLTS data, confirm that labor shortages will continue to provide a stiff headwind to hiring," said Basu. "The construction unemployment rate inched up to 3.6% in June, but that’s still the second-lowest rate on record. Across all industries, unemployment remains near a 50-year low, and the prime age (24-54) employment-to-population ratio rose to the highest level since 2001. High interest rates and the cumulative effects of inflation will eventually catch up with the economy. For now, however, the labor market remains overheated."
Press Release from Associated General Contractors of America (AGC)
Construction Gains Were Evenly Split Between Residential and Nonresidential Firms for the Month, But Near-Record Job Openings at End of May Point to Ongoing Challenges in Finding Qualified Workers
The construction sector added 23,000 jobs in June while the sector’s unemployment rate fell to the lowest rate ever for the month and pay levels in the industry continued to rise, according to an analysis of new government data the Associated General Contractors of America released today. Association officials said there appears to be plenty of demand for construction services and that employers likely would have added even more jobs if they could find more workers to hire.
“There was no letup in demand for construction workers in June, while the supply of available workers remained exceptionally tight,” said Ken Simonson, the association’s chief economist. “Both residential and nonresidential construction are expanding despite concerns about overall economic growth and inflation.”
Construction employment in June totaled 7,947,000, seasonally adjusted, an addition of 23,000 or 0.3 percent from the month prior. The sector has added 198,000 jobs during the past 12 months, an increase of 2.6 percent. Nonresidential construction firms—nonresidential building and specialty trade contractors along with heavy and civil engineering construction firms—added 12,200 employees in June. Meanwhile, employment at residential building and specialty trade contractors grew by 10,800.
The unemployment rate among jobseekers with construction experience dipped from 3.7 percent in June 2022 to 3.6 percent, the lowest June rate in the 24-year history of the data. A separate government report released earlier this week reported that there were 396,00 job openings in construction at the end of May, the second-highest May total in series history and a further sign of contractors’ difficulty in finding qualified workers.
Average hourly earnings for production and nonsupervisory employees in construction—covering most onsite craft workers as well as many office workers—climbed by 5.7 percent over the year to $34.09 per hour. Construction firms in May provided a wage “premium” of more than 18 percent compared to the average hourly earnings for all private-sector production employees.
Association officials noted that construction firms and AGC of America are working hard to identify, recruit, train and employ new workers. But they said labor conditions were extremely tight, noting relatively few workers are exposed to construction career opportunities. They faulted federal officials for investing far less in education programs that focus on skills needed in industries like construction in favor of encouraging most students to go to college.
“Holding photo ops with construction workers is great, but it would be a lot more helpful if politicians actually invested in construction-focused education and training,” said Stephen E. Sandherr, the association’s chief executive officer. “The more we expose current and future workers to the high-paying career opportunities available to them in construction, the more likely they are to pursue those careers.”
