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Dive Brief:
- Construction job offers fell 17.1%, or 51,000, in July, according to Bureau of Labor Statistics data released Wednesday. The report measures the number of seasonally adjusted open positions for which employers are actively hiring.
- This decline followed a seasonally adjusted decline of approximately 18% in June. July also saw nearly 30%, or more than 100,000, fewer construction job openings compared to the same month last year. As non-residential construction continues to experience strong demand for workers, experts theorize much of the drop in demand is in residential work.
- “More housing units were completed in June than in any month of 2007, and the number of under construction has fallen roughly 8% since the beginning of the year,” Anirban Basu, chief economist at Associated Builders and Contractors, said in a statement. The BLS report does not differentiate between commercial and residential construction jobs.
Diving knowledge:
While this may be largely due to residential cooling, there is also evidence of a slight reduction in commercial labor demand.
Overall, 2.9% of all construction positions were unfilled in July, a lower share of openings than June’s 3.5% and July’s 4.2%.
“The share of construction jobs that are currently unfilled has fallen to the lowest level since the start of 2018, and part of this contraction is due to weakness in certain segments such as commercial and accommodation,” Basu said. “Despite a shortage of openings, contractors continue to lay off workers at a historically slow pace, with fewer than 1 in 7 contractors expecting their staffing levels to decrease over the next six months, according to the Confidence Index the construction of ABC”.
Ken Simonson, chief economist at the Associated General Contractors of America, noted that the census data showed month-over-month declines in both residential (-0.4%) and non-residential spending (-0.2%) from June to July, but noted nearly all non-residential segments experienced year-over-year increases.
In addition, an AGC survey found that a surprising 94% of respondents – made up of companies that do all types of construction except single-family – had openings for hourly tradesmen at the end of June, up 9% from a year ago a year And more than nine out of 10 the contractors they are hiring are in trouble finding workers, found AGC.
“I believe the census data and AGC survey results suggest that the apparent weakening of demand for workers is limited to residential construction and selected segments of non-residential (mostly office and warehouse construction) Simonson told Construction Dive via email. “Overall, non-residential construction firms are still eager to hire and still have difficulty finding skilled workers.”
