The construction industry has again released statistics that do not seem to quite add up, this time concerning employment.
In July, builders recorded a loss of 6,000 jobs in July, according to figures from the U.S. Department of Labor. Yet, construction unemployment fell to 9.1 percent, down from 9.8 percent last month and significant decrease from the 12.3 percent jobless rate reported in July 2012.
According to a leading construction economist, the labor numbers make sense when compared with spending, and it is yet more bad news for the industry.
“(This) employment report is consistent with the June construction spending report, which indicated that overall construction spending declined by 0.6 percent and that nonresidential construction spending was off by 1 percent,” said Associated Builders and Contractors (ABC) chief economist Anirban Basu. “That type of performance is not consistent with robust job creation, so it’s no surprise that the construction industry did not deliver net new jobs last month.”
In the U.S., nonresidential building construction employment increased by 300 jobs for the month and is up by 18,700 jobs, or 2.8 percent, since July 2012. Nonresidential specialty trade contractors lost 9,800 jobs for the month, but employment remains 1.8 percent higher compared to one year ago. Employment for heavy and civil engineering construction was down by 2,000 jobs for the month, but is up by 19,200 jobs, or 2.2 percent, on a year-over-year basis.
In comparison, residential building construction employment increased by 100 jobs in July and has expanded by 7,400 jobs, or 1.3 percent, during the past 12 months. Residential specialty trade contractors added 6,200 jobs in July and have added 84,700 jobs, or 5.8 percent, since July 2012.
“The major source of construction employment loss was among nonresidential specialty trade contractors, which forfeited nearly 10,000 jobs in July,” Basu said. “This segment had been recovering nicely, but now appears to be feeling the effects of an economy growing at less than 2 percent.
“Meanwhile, the loss of 2,000 jobs in the heavy and civil engineering construction sector may be a partial reflection of sequestration. Despite the job losses, the construction unemployment rate declined last month; however, much of the drop has been attributed to people leaving the industry.”
The Mississippi Department of Employment Security (MDES) projects a 7.3 percent increase in construction managers through 2020, while construction trade workers are forecast to grow 4.9 percent. MDES projects the state’s construction industry will need 6.5 percent more general laborers over the same time period.
The latest figures from the U.S. Dewpartment of Labor shows Mississippi’s construction community employing approximately 50,500 workers — or about 46.742 employment per 1,000 state jobs.
The employment picture follows a recent trend of confusing construction numbers. In June, construction materials prices decreased 0.1 percent.
Taken as a whole, materials prices had remained flat for the previous several months. However, among the various commodities, prices showed wide variances — some up, some down.
“This elevated level of price stability is somewhat unexpected given shifting monetary policies in much of the world, including in the form of substantial money supply creation, concerns regarding the U.S. fixed income and equity markets, which has rendered investors a bit more skittish of late, and a global economy positioned to expand more than 3 percent this year,” said Basu in a statement back in June. “Despite those factors, commodity prices have remained relatively stable and so have nonresidential construction materials prices.”
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