Construction job growth expectations weren't achieved in August, but according to Associated Builders and Contractors (ABC) Chief Economist Anirban Basu, overall employment was "just about perfect." After the U.S. Bureau of Labor Statistics data release, ABC released its analysis on Sept. 6, citing a 2.4% increase in construction employment year-over-year.
Last month, 14,000 net new jobs were added to the construction industry. Nonresidential construction employment made up a fair share of the results, with an increase of 11,600 net jobs or 2.5% growth since August 2018. While construction employment increased 0.2 percentage points in the past year, overall industry unemployment remained about the same at 3.7% in August.
Basu said industry job growth "fell short of projections," but industries should not fret.
"Yes, employment growth has been softening for quite some time, with average monthly job growth totaling 150,000 during the last six months after approaching 200,000 during the prior six-month period," Basu said. "And employment growth estimates were also revised lower for both June and July. That said, looking beyond the headline number, August's labor market performance was more than respectable, even accounting for about 25,000 of the jobs added being for temporary Census work."
Among the jobs added were nonresidential specialty trade contractors with 5,400 jobs, followed by heavy and civil engineering at 4,400 jobs and nonresidential building at 1,800 jobs, the report states. Given the latest data, Basu said it is possible the Federal Reserve will cut rates in the near future, possibly making way for more investors and lowering borrowing costs.
—Andrew Michaels, editorial associate