U.S. construction firms added 11,000 jobs in September as strong nonresidential hiring more than offset continued losses in residential construction. Federal employment data released on October 2 shows.
Non-residential contractors added 16,100 workers during the month, including 12,300 at specialty trade contractors, according to an Associated Builders and Contractors analysis of data from the US Bureau of Labor Statistics. Civil and heavy engineering firms added 2,600 workers and nonresidential building contractors added 1,200.
Residential construction lost 4,900 net jobs. Residential specialty trade contractors shed 7,900 jobs, partially offset by a 3,000 job increase among residential builders.
The construction gains came as U.S. employers added just 29,000 total jobs in September and the national unemployment rate rose to 4.2 percent from 4.1 percent in August. Economists polled by Dow Jones had expected 84,000 new jobs and unemployment to remain at 4.1%.
BLS also revised July and August payroll growth down by a combined 60,000 jobs, with July’s gain of 21,000 jobs turning into a loss of 10,000.
Average hourly earnings in construction rose 4.2% in the year to September, compared with a 3% increase in the private sector. Click on the image to enlarge it.
Graph by ENR; data: US Bureau of Labor Statistics
“The construction industry added jobs for the seventh straight month in September,” ABC chief economist Anirban Basu said in a statement. “Job growth in the industry is increasingly concentrated on the non-residential side as the data center boom continues to support rapid hiring of certain specialty contractors.”
Over the past year, employment in non-residential construction has increased by 142,000 jobs, or 2.9%, while residential construction has lost 32,800 jobs, or 1%, according to ABC analysis. Global construction employment reached 8.364 million in September, up 109,000 jobs, or 1.3%, from a year earlier.
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Employment also increased among companies in the design sector. Architectural, engineering and related services added 5,800 jobs in September, bringing employment in the category to nearly 1.779 million.
The construction unemployment rate was 3.5% in September, compared with 3.8% a year earlier, according to the BLS. The unemployment figures for the sector are not seasonally adjusted.
Construction wages also continued to rise faster than those in the private sector overall. Average hourly earnings for construction workers reached $41.69 in September, up 4.2% from $40.01 a year earlier. Hourly earnings in the private sector rose 3% over the same period to $37.81 from $36.70.
Job growth varies greatly by metro
Construction employment rose in 177 of 360 metro areas, or 49 percent, in the 12 months through August, according to a Sept. 30 analysis of BLS data from the Associated General Contractors of America. Employment decreased by 126 meters and remained unchanged at 57.
Nonresidential contractors added 16,100 jobs in September, including 12,300 in specialty trades, while residential construction lost a net 4,900 jobs. Click to enlarge the image.
Graph by ENR; data: US Bureau of Labor Statistics
“Data centers, energy projects and advanced manufacturing plants are spurring job gains across many metros,” AGC Chief Economist Ken Simonson said in a statement accompanying this analysis. “But other locations are experiencing job losses as volatile rates, rising material costs and tough immigration policies discourage landlords from committing to new construction.”
Houston-Pasadena-The Woodlands, Texas, added 14,100 construction jobs, or 6 percent, through August, the largest numerical increase, while Baton Rouge, La., led the percentage gain at 29 percent. The metro Atlanta division lost 4,900 jobs, or 4 percent, the largest numerical drop, followed by Riverside-San Bernardino-Ontario, Calif., which shed 4,600, or 4 percent.
Despite residential losses and broader labor market weakness, Basu said contractor hiring expectations remain high, according to ABC’s construction confidence index, “a view that appears justified given the insatiable demand for new data centers.”
