Construction sees minor job growth in March
The construction industry added 16,000 net new jobs in March, according to an Associated Builders and Contractors analysis of data released today by the Bureau of Labor Statistics. On a year-over-year basis, industry employment is up 246,000 jobs, representing a 3.4% increase. Nonresidential employment added 3,200 net new jobs last month, with the bulk of growth among nonresidential specialty contractors, which added 5,500 net new jobs. Heavy and civil engineering added 600 jobs, while the nonresidential building category lost 2,900 positions.
The construction industry unemployment rate fell to 5.2%, down a full percentage point from the previous month. Compared to the same time last year, unemployment is down by 2.2 percentage points, and national unemployment remained unchanged at 3.8%.
“Today’s construction employment number was important for two reasons,” said ABC Chief Economist Anirban Basu. “First, the solid gains in several nonresidential construction segments, including among nonresidential specialty contractors, indicates that the level of construction activity remains robust as we approach spring. The expectation is that construction employment will continue to expand into the summer given normal seasonal factors and the level of backlog as measured by ABC’s Construction Backlog Indicator.
“The second source of importance relates to February’s weak job numbers,” said Basu. “While economists were quick to suggest that February’s construction job losses were largely attributable to weather, there were some doubts given other weak readings regarding retail sales and other economic indicators since December. Today’s readings suggest that February employment data represented an aberration and that the economic and employment expansion remains in place.
“The data also showed that public construction spending growth has replaced private construction spending growth as the industry’s driver,” said Basu. “For years, public investment languished while private sector construction spending surged in the context of a recovering economy, plentiful liquidity and low costs of capital. However, steady improvement of state and local government finances in certain parts of the nation has created more financial capacity to move forward with infrastructure projects. In particular, recently released spending data indicate significant growth in highway and street projects, which is consistent with the ongoing creation of net new jobs in the heavy and civil engineering category. Meanwhile, employment in the nonresidential building category dipped by nearly 3,000 jobs in March.”