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Dive brief:
- Contractors laid off 99,000 workers in August, a drop of nearly 46 percent from a year ago and the lowest number since the Bureau of Labor Statistics began reporting job openings in December 2000, according to Anirban Basu, chief economist at Associated Builders and Contractors.
- Construction had 251,000 open jobs on the last day of August, according to the BLS report released Tuesday. The number of open positions for which they were actively hiring fell by 48,000 month over month, but rose by 38,000 year over year.
- Of all construction jobs, 2.9% remained unfilled at the end of August. The number of job openings were the highest since MarchBasu said. The combination of openings and layoffs paints a picture of employers desperate to hang on to the workers they have.
Diving knowledge:
BLS data indicates that both the demand and supply of construction workers have declined, Basu said.
“These dynamics may seem contradictory, but they are consistent with continued weakness in the residential segment, along with increased data center activity and the resulting shortage of certain skilled workers,” Basu said in an ABC analysis of the data.
Non-residential builders said they were likely to increase their staffing levels in the next six months, according to the ABC’s Contractor Confidence Index. As a result, Basu predicted that labor costs will continue to rise, especially for in-demand occupations such as electricians and HVAC workers.
Macrina Wilkins, director of market information for the Associated General Contractors of America, has said for several months that the data indicates that companies are desperate to keep the workers they have, while they continue to monitor the market for a possible change in the availability of new workers.
“The combination of an all-time low layoff rate and an increase in the job posting rate suggests that contractors are still eager to maintain or increase their current headcount,” Wilkins told Construction Dive via email. “Companies still have positions they need to fill, but are struggling to match those vacancies with qualified workers.”
A low hiring rate could indicate the problem Basu touched on, namely the challenges of finding those with in-demand skills.
“While a low hiring rate often suggests a lack of current demand for workers, in this case it may also reflect the difficulty contractors are having finding qualified employees at a time of heightened immigration enforcement and a record low unemployment rate for construction workers of 3.1 percent in August,” Wilkins said.
