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Construction Employment Increases in Metro Areas, but Spending Cuts Pose Risks

 

Construction employment increased in 158 out of 339 metropolitan areas between February 2012 and February 2013, declined in 132 and was stagnant in 49, according to a new analysis of federal employment data released today by the Associated General Contractors of America.

Association officials noted that the industry’s long-awaited recovery could prove fleeting if public construction spending continues to decline and a reported immigration reform deal could undermine efforts to recruit skilled workers.

“While construction employment continues to decline in many parts of the country, the number of communities experiencing gains continues to expand,” said Ken Simonson, the association’s chief economist. “But the twin threats of additional public sector construction cuts and a looming shortage of certain types of construction workers could hurt the industry just as it is beginning to recover.”

Pascagoula, Miss., added the highest percentage of new construction jobs (51%, 1,800 jobs) followed by El Centro, Calif. (23%, 300 jobs); Anchorage, Alaska (22%, 1,800 jobs), Fargo, N.D. (20%, 1,200 jobs) and Merced, Calif. (20%, 300 jobs).

Arizona added 8,400 jobs, an 8% increase.

Houston-Sugar Land-Baytown, Texas (13,200 jobs, 8%) added the most jobs. Other areas adding a large number of jobs included Dallas-Plano-Irving, Texas (10,700 jobs, 10%); Los Angeles-Long Beach-Glendale, Calif. (8,500 jobs, 8%) and Fort Worth-Arlington, Texas (7,200 jobs, 12%).

The largest job losses were in Northern Virginia (-3,100 jobs, -5%); followed by Cincinnati-Middletown, Ohio-Ky.-Ind. (-2,400 jobs, -7%); Raleigh-Cary, N.C. (-2,300 jobs, -8%); Charleston, W.V. (-2,100 jobs, -15%) and Detroit-Livonia-Dearborn (-2,100 jobs, -13%).

Monroe, Mich. (-22%, -500 jobs) lost the highest percentage. Other areas experiencing large percentage declines in construction employment included Atlantic City-Hammonton, N.J. (-20%, -1,000 jobs) and Rockford, Ill. (-18%, -700 jobs).

Association officials noted that the rebound in construction employment in many parts of the country is taking place despite a 17% decline in public sector construction spending during the past four years. They added that additional cuts, including $4B in construction cuts from the federal sequester, would have a significant impact, especially on firms that specialize in public sector work. They added that reports that an immigration reform proposal that includes severe limits on skilled construction workers would make it hard for recovering firms to find enough skilled workers.

“Between the dismantling of skills-based, vocational, education programs, the aging of the current workforce and years of bad economic news that have discouraged potential entrants from considering careers in construction, the pool of available skilled workers is relatively small,” said Stephen E. Sandherr, the association’s chief executive officer.

“This industry could go from having too little work to having too few workers. Thus, it is critical for comprehensive immigration reform to include reasonable options to recruit temporary guest workers when domestic sources are exhausted.”

 

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