Industry added 33,000 net new jobs in April
According to Associated Builders and Contractors (ABC) analysis of data from the U.S. Bureau of Labor Statistics, the future looks bright for jobs in construction. The industry had 256,000 more jobs in March then it had the year before, representing a 3.5 percent increase. With 33,000 net new jobs added to the industry again in April, construction unemployment is now at a record low.
Downturn fading fast
There are other positive signs across the broader economy. Nonresidential employment added 32,400 net new jobs in April, although the nonresidential building sub-segment added just 400 net new jobs. Nonresidential specialty trade contractors led the segment, adding 22,100 net new jobs compared to March and 114,300 net new jobs year over year.
Overall, the construction industry unemployment rate fell to 4.7 percent, down 2.2 percentage points from the same time last year, which represents the lowest April rate since the series began in the year 2000. The national unemployment rate for all industries fell to 3.6 percent in April.
“Many economists are predicting a recession in 2020 or 2021,” said ABC Chief Economist Anirban Basu. “While that’s possible, the case for an economic downturn over the next 12 to 18 months is fading fast. The nation has added jobs in 103 consecutive months and the unemployment rate is at its lowest level since 1969. With inflation and interest rates low, the cost of capital remains suppressed, helping to induce ongoing spending growth among companies, consumers and governments alike. Corporate earnings remain strong, and today’s employment report indicates that many remain firmly in growth mode.”
Bernard M. Markstein, president and chief economist of Markstein Advisors, who conducted the analysis for ABC, noted that in March, construction unemployment decreased in 49 states on a year-over-year basis, the first time on record that all but one state saw declines. (Nebraska was the only outlier with a slight increase from 5.1 percent unemployment in March 2018 to 5.3 percent in March 2019.)
For construction firms, the report is “consistent with lengthy backlog, continued expansion in consumer outlays, growing demand for office and other forms of space and steady demand for construction services,” said Basu.
The challenge for the industry will be the struggle to identify and afford talent as the average hourly earnings for construction employees increased by 0.4 percent from March to April, approximately twice the rate of growth observed across all industries.
This is why The Associated General Contractors of America is urging federal officials to include initiatives to expand career and technical education in any infrastructure bills.
“With overall unemployment now at the lowest level in nearly 50 years, contractors are having an ever harder time finding workers with or without construction experience,” said Ken Simonson, AGC’s chief economist. “Average pay in construction is more than 10 percent higher than in the private sector as a whole, but job openings in the industry keep climbing.”
Opportunities abound as careers in construction grow in Southern California. Consider a career in construction. Here’s information on training and apprenticeships to get you started.
Also, check out 5 Trends that Will Change the Skilled Trades Industry.
Source: Associated Builders and Contractors, Inc.