Construction employment increased by 27,000 jobs in November, according to www.abc.org. During the past seven months, the industry has added 804,000 jobs, recovering about 74% of the industrywide jobs lost since the start of the COVID-19 pandemic.
The construction unemployment rate rose from 6.8% in October to 7.3% in November—an increase of 2.9 percentage points compared with the same time last year and an increase of 0.5 percentage points compared with October. The national unemployment rate for all industries fell from 6.9% in October to 6.7% in November as the U.S. economy added 245,000 jobs.
Nonresidential construction employment added 11,900 jobs on net in November, and there were job gains in two of the three nonresidential segments; the largest increase was registered among heavy and civil engineering, which added 9,500 jobs on net. Nonresidential building added 3,600 jobs, and the number of nonresidential specialty trade contractors declined by 1,200 jobs on net.
“The economic momentum that began in May continues to wane,” said Associated Builders and Contractors Chief Economist Anirban Basu. “While it is true that unemployment declined nationally, this result was largely driven by a decline in labor force participation. America’s labor force has 4 million fewer workers than in February. Based simply on momentum, it is quite likely that one or more of the next three jobs reports will indicate a loss of employment.
However, Basu said “the performance of nonresidential construction is rather impressive.” The industry has faced many challenges during the COVID-19 crisis, and the nonresidential construction segment has remained relatively stable. Still, he believes the most challenging days likely are ahead.
“It is normal for nonresidential construction activity to hold up well during the early stages of an economic downturn and then experience a decline in fortunes thereafter,” Basu said. “ABC’s most recent Construction Backlog Indicator survey shows that many contractors have sustained significant declines in backlog over the course of the year. Anecdotal information suggests that bidding opportunities for new projects have become scarcer and competition for the next generation of jobs fiercer. ABC’s Construction Confidence Indicator shows that the average contractor expects profit margins to dip over the next six months. If the U.S. economy continues to weaken into and through the winter, that will further postpone the nonresidential segment’s complete recovery.”
