According to data released today by the US Bureau of Labor Statistics, the national construction industry added 20,000 jobs on net in November.
Press Release from Associated Builders and Contractors, Inc (ABC)
WASHINGTON, Dec. 2—The construction industry added 20,000 jobs on net in November, 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 risen by 248,000 jobs, an increase of 3.3%.
Nonresidential construction employment increased by 16,300 positions on net, with growth registered in all three subcategories. Nonresidential building added 8,200 net new jobs, while heavy and civil engineering and nonresidential specialty trade added 5,300 and 2,800 jobs, respectively.
The construction unemployment rate fell to 3.9% in November, while unemployment across all industries remained unchanged at 3.7%.
“Today’s employment report will be celebrated by many, including jobseekers and other labor market participants,” said ABC Chief Economist Anirban Basu. “Despite some recent high-profile layoffs, employers continue to hire aggressively and are increasing compensation in an effort to retain employees in the context of the ‘great resignation.’
“Normally, such dynamics would be celebrated by all,” said Basu. “However, for those who want inflation to abate, interest rates to fall and markets to be less volatile, the November jobs report is rather bad news. Those operating in real estate and construction are likely to be discouraged, as these segments are heavily influenced by interest rates, and rising borrowing costs make it more difficult to finance the next generation of construction projects.
“Moreover, while some will claim that this jobs report makes it less likely that recession is coming next year, the reality is quite the opposite,” said Basu. “The Federal Reserve will be forced to push interest rates higher for longer, and that makes a downturn more probable over the next 12 months.”
Press Release from Associated General Contractors of America (AGC)
But Record-Tying Low Unemployment Rate of 3.9 Percent and Elevated Number of Job Openings Suggest Construction Industry Continues to Fall Short of Hiring as Many Workers as It Needs
Construction companies added 20,000 employees in November and continued to raise wages for hourly workers more steeply than other sectors as the industry’s unemployment rate tumbled, according to an analysis by the Associated General Contractors of America of new government data. Association officials said the data shows that firms would have added significantly more workers if they could find more people to hire.
“It is heartening that both residential and nonresidential construction firms were able to add employees in November,” said. “But the number of job openings continues to outpace hiring, suggesting employers wanted to bring on many more workers than they are able to find.”
Construction employment totaled a record-high 7,750,000 in November, an increase of 20,000 for the month and 248,000 or 3.3 percent from a year earlier. Nonresidential firms—comprising nonresidential building and specialty trade contractors along with heavy and civil engineering construction firms—added 16,300 employees in November. Residential building and specialty trade contractors together added 3,900 employees.
Pay levels in the construction industry continued to increase in November at a faster pace than in the overall private sector. Average hourly earnings for production and nonsupervisory workers in construction—mostly hourly craft workers—climbed by 6.1 percent, from $31.04 in November 2021 to $32.94 last month. That increase exceeded the 5.8 percent rise in average pay for all private sector production workers. Such workers in construction now earn an average of 17.2 percent more per hour than in the private sector as a whole.
The unemployment rate among jobseekers with construction experience decreased from 4.7 percent in November 2021 to 3.9 percent last month, tying the 2018 rate for the lowest ever for November. The number of unemployed construction workers fell by 16 percent, from 469,000 in November 2021 to 393,000 in November of 2022.
A separate government report on Wednesday showed there were 377,000 job openings in construction at the end of October, which exceeded the number of employees—341,000—hired during that month. The excess of job openings over hires indicated the industry wanted to hire more than twice as many workers as it was able to find in the current low-unemployment environment, Simonson said.
Association officials noted they were taking steps to help, including running digital advertising recruiting campaigns and working to increase employee retention rates in the industry. But too few students are exposed to construction career opportunities in school as educators encourage most students to pursue college degrees and office jobs, they warned. As a result, high-paying construction positions remain unfilled while many college graduates struggle to pay off student loans in lower paying jobs.
“Public officials are missing a great opportunity to put many more people on the path to financial security,” said Stephen E. Sandherr, the association’s chief executive officer. “Instead of encouraging students to amass even more debt, we should be exposing them to careers where they can earn a great living without worrying about unsustainable levels of college debt.”