Dive Brief:
- Construction job offers plummeted by 71,000, or about 19% from May to June, according to the latest Bureau of Labor Statistics employment report released Tuesday. The data measures the positions for which employers are currently hiring.
- The 295,000 available jobs on the last day of June represented a 29% decline from the same month in 2023. In total, 3.5% of all construction jobs went unfilled in June.
- Experts continue to attribute the recent declines in job openings to a slowdown in residential construction, saying high interest rates have dragged down homebuilding delays, while infrastructure and manufacturing spending continue to anchor the commercial work
Diving knowledge:
The demand for commercial construction workers is not likely to decrease.
“More housing units were completed in June than in any month since January 2007, and high interest rates have weighed on homebuilder delays,” said Anirban Basu, chief economist at ‘Associated Builders and Contractors, in a press release. “Non-residential construction maintains momentum due to strength in certain segments such as manufacturing and infrastructure, and this should keep labor demand high.”
The big drop in openings suggests a slowdown in demand, but a lower rate of layoffs suggests companies still expect they will need workers in the near future, said Ken Simonson, chief economist at the Associated General Contractors of America , at Construction Dive.
In June, 133,000 construction workers were laid off and 124,000 quit, down 11% and 34% from the previous month, respectively. Additionally, the unemployment rate for workers with construction experience was 3.3% in June, the lowest rate for the month in the report’s 25-year history, according to Simonson, and lower than national rate of all industries.
“This suggests that experienced workers are in short supply and helps explain why construction companies won’t lay off those they have, even if they don’t have as much work for them at the moment,” Simonson said.
Simonson noted that the BLS does not separate residential from non-residential in its measures, which can make the data difficult to interpret. That said, he also noted the decline in housing construction.
“I think there has been a big drop in office and warehouse projects, as well as residential. This should be offset by extremely strong growth in data centers, continued strength in manufacturing and an increase in renewable energy and infrastructure work,” Simonson said. “But the timing of energy and infrastructure is unpredictable and may cause contractors to withdraw their aid signs for now.”
