Construction employment rate is rising, but remains at pre-pandemic highs

Diving letter:

  • According to an analysis of federal government data by the Associated General Contractors of America, employment in 39 states fell below its pre-February 2020 peak in June.
  • Although it hasn’t returned to pre-pandemic levels, employment in construction has improved over the past year, according to a report by Associated Builders and Contractors.
  • Both AGC and ABC suggest that supply chain constraints and rising material prices are undermining demand for new projects and affecting companies’ plans to recruit new workers.

Dive Insight:

Although national employment in construction rose by 233,000 compared to June 2020, the seasonally adjusted employment in construction remained, according to data from ABC report. According to the AGC report.

A number of owners are postponing projects because rising costs and delivery delays have made projects impossible or they want to wait for conditions to improve, said AGC chief economist Ken Simonson.

“We’re seeing some recovery, not back where we were, but we’re moving forward,” said Bernie Markstein, president and chief economist of Markstein Advisors, a business advisory firm. “A big question is, will Washington have an infrastructure bill? Obviously, if we get that, it will help the construction. Overall, I’m pretty optimistic about the construction.”

The Senate voted for on Wednesday advance an invoice This includes $ 550 billion in new federal funding for infrastructure. AGC officials said President Joe Biden could further help the industry by “removing tariffs on key building materials” and “removing unemployment benefits,” according to the report. That would increase the pool of workers that can be hired.

“First of all, there is a long-term problem, especially with enough skilled workers [and] The pandemic has only exacerbated that problem, “Markstein said.” The rate at which people are retiring and the skill gap that exists is quite large. That will remain a problem for the industry for at least a few years and maybe five years or more. “

According to the ABC report, the national unemployment rate in construction rose from 5.5% in February 2020 to 7.5% in June 2021.

From May through June, construction employment declined in 25 states, rose in 24 states and Washington, DC, and stayed the same in Maine, according to the AGC report. The biggest decline during the month was New York, which lost 6,900 construction jobs, or 1.9%, followed by Pennsylvania, which lost 4,100 jobs, or 1.6%. The largest percentage declines since May have been in Vermont, which lost 3.5%. New York, Alabama, and North Dakota each lost 1.9% of previous construction jobs, according to the AGC report.

Georgia created the most construction jobs and around 5,700 jobs over the same period, an increase of 2.9%. Kentucky and Florida followed with 2,700 jobs or 3.4% and 2,500 jobs or 0.4%, respectively. Kentucky saw the highest percentage gains from May to June, followed by Alaska and Georgia, both of which rose 3.0%.

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