Construction Sees ‘Another Perfect Employment Data Release’
As unemployment continues to decline, the construction sector is among the industries to see job growth in September in what Associated Builders and Contractors (ABC) Chief Economist Anirban Basu described as "another perfect employment data release." According to an ABC report on Oct. 4, net new construction jobs increased by 7,000 last month with an unemployment rate of 3.2%, nearly one percentage point shy of last year's results.
The majority of new positions were seen in nonresidential specialty trade at 3,000 jobs, followed by 2,400 jobs in heavy and civil engineering. On the other hand, nonresidential building construction jobs dropped by 1,600.
"Nonresidential construction employment continued to expand in September, a reflection of a segment that remains flush with work," Basu said in the report. "The ongoing declines in various measures of unemployment are consistent with the notion that the average contractor, including subcontractors, will continue to face enormous difficulty recruiting new employees. Many contractors continue to pay for substantial overtime, translating into flat profit margins or worse in the context of still plentiful bidding opportunities."
Despite the good news, Basu added, commercial construction is beginning to slow due to lack of space and funds for certain projects—a potential problem the industry will want to keep its eye on. But for now, the future appears bright.
"In total, [the Oct. 4] release suggests that the current U.S. economic expansion will persist for the foreseeable future, as ongoing job growth propels consumer spending and as surprisingly modest inflationary pressures keep interest rate increases at bay," he said.
—Andrew Michaels, editorial associate