TWIA Commercial Property & Casualty
Construction job openings plummet 19%
Jul
Dive Brief:
- Construction job openings plummeted by 71,000, or about 19% from May to June, according to the Bureau of Labor Statistics’ latest jobs report released Tuesday. The data measures positions for which employers are currently hiring.
- The 295,000 available jobs on the last day of June marked a 29% decrease from the same month in 2023. In total, 3.5% of all construction jobs went unfilled in June.
- Experts continue to ascribe recent drops in job openings to slowdowns in residential construction, saying that high interest rates have dragged down home building backlogs, while infrastructure and manufacturing spending continue to anchor commercial work.
Dive Insight:
The demand for commercial construction workers likely isn’t going to lessen.
“More new housing units were completed in June than in any month since January 2007, and high interest rates have weighed on home builders’ backlogs,” said Anirban Basu, chief economist for Associated Builders and Contractors, in a news release. “Nonresidential construction retains momentum due to strength in certain segments like manufacturing and infrastructure, and that should keep the demand for labor elevated.”
The big drop in openings suggests slowing demand, but a lower rate of layoffs suggest firms still expect they’ll need workers in the near future, Ken Simonson, chief economist for Associated General Contractors of America, told Construction Dive.
In June, 133,000 construction workers were laid off and 124,000 quit, down 11% and 34% from the month before, respectively. In addition, the unemployment rate for workers with construction experience was 3.3% in June, the lowest rate for the month in the 25-year history of the report, according to Simonson, and lower than the nationwide rate for all industries.
“That suggests experienced workers are scarce and helps explain why construction firms aren’t laying off the ones they have, even if they don’t have as much work for them at the moment,” Simonson said.
Simonson noted the BLS doesn’t break out residential from nonresidential in its measurements, which can make it challenging to interpret the data. That said, he also remarked on the decrease in homebuilding.
“I think there has been a big drop in office and warehouse projects, as well as residential. That should be outweighed by extremely strong growth in data centers, continuing strength in manufacturing and a pickup in renewable energy and infrastructure work,” Simonson said. “But the timing of the energy and infrastructure projects is unpredictable and may leave contractors pulling back their Help Wanted signs for the time being.”
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