Construction employment expanded in two-thirds of all states in January as the industry showed signs of emerging from a 6-year slump, according to an analysis by the Associated General Contractors of America of Labor Department data.
Association officials cautioned, however, that the industry’s recovery remains fragile and that current and looming federal budget cuts threaten to drag down construction employment in numerous states.
“These results show that contractors are finding work in more parts of the country than they have for many months,” said Ken Simonson, the association’s chief economist. “Further gains appear likely but could be derailed if lawmakers continue to make indiscriminate cuts to key construction and infrastructure programs.”
From January 2012 to January 2013, 24 states and the District of Columbia added construction jobs, 25 shed workers and one — Wisconsin — had no change.
D.C. jumped to the top ranking for percentage of new construction jobs (9.4%, 1,200 jobs); followed by North Dakota (9.0%, 2,500 jobs); Hawaii (8.0%, 2,300 jobs); Alaska (7.2%, 1,200 jobs) and Washington (6.0%, 8,200 jobs). Texas (28,500 jobs, 5.0%) added the most new construction jobs over the past 12 months, followed by California (17,600 jobs, 3.0%) and Washington.
Arizona ranked No. 9, adding 5,200 construction jobs, a 4.5% increase for that period. In January, Arizona added 1,500 construction jobs, a 1.3% increase over December 2012.
Among states losing construction jobs during the past year, Arkansas lost the highest percentage (-10.5%, -5,100 jobs), followed by Rhode Island (-8.0%, -1,300 jobs); Montana (-7.2%, -1,700 jobs) and South Dakota (-6.4%, -1,400 jobs). Illinois lost the most jobs (-9,800 jobs, -5.0%); followed by Virginia (-7,500 jobs, -4.2%); Ohio (-5,200 jobs, -2.8%) and Arkansas.
Simonson noted that 34 states and D.C. added construction jobs between December and January, while employment slipped in 14 states and held steady in two states. Wyoming had the largest percentage increase (4.6%, 1,000 jobs); followed by New York (4.2%, 13,000 jobs). New York added the largest number of jobs, by far — probably reflecting recovery work from Hurricane Sandy.
Alaska and South Dakota had no change in construction employment over the month, while 14 states lost jobs, with Arkansas having the steepest percentage drop (-5.0%, -2,300 jobs); followed by Kansas (-4.0%, -2,200 jobs). Arkansas lost the largest number of jobs for the month; followed by Kansas and Pennsylvania (-2,200 jobs, -1.0%).
“Construction spending has been rising for two full years but contractors have been cautious about adding workers until they knew the upturn would last,” Simonson explained. “In 2013, both residential and private nonresidential construction should rise enough to offset a further slowdown in public work, and contractors will be looking for more workers.”
Association officials said the cuts in federal funding for construction triggered both by the so-called sequestration that took effect earlier this month and by spending bills now advancing in Congress would fall hardest on construction employers in states that have a large federal government presence. They urged lawmakers to address out-of-control entitlement spending instead of making disproportionate cuts to funding for essential infrastructure and military projects.
“Canceling construction investments will ultimately worsen the deficit by undermining the nation’s growth and competitiveness,” said Stephen E. Sandherr, the association’s chief executive officer. “Meanwhile, the burden falls unfairly on states that host large military facilities, as well as states with extensive federal lands, research and energy installations.”