TWIA Commercial Property & Casualty
Job openings drop again, but commercial builders still seek workers
Sep
Dive Brief:
- Construction job openings dropped 17.1%, or by 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.
- That plunge followed a roughly 18% seasonally adjusted decline in June. July also counted nearly 30%, or over 100,000, fewer open construction jobs when compared to the same month last year. As nonresidential construction continues to experience a high 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 dating back to 2007, and the number of housing units under construction has fallen about 8% since the start of the year,” said Anirban Basu, chief economist for Associated Builders and Contractors, in a release. The BLS report does not differentiate between commercial and residential construction jobs.
Dive Insight:
Even though it may largely be due to residential cooling, there’s evidence of slight softening for commercial labor demand, too.
In total, 2.9% of all construction positions went unfilled in July, a smaller share of open spots than June’s 3.5% and last July’s 4.2%.
“The share of construction jobs that are currently unfilled has fallen to the lowest level since early 2018, and a portion of that contraction is due to weakness in certain segments like commercial and lodging,” said Basu. “Despite the dearth of openings, contractors continue to lay off workers at a historically slow pace, and fewer than 1 in 7 contractors expect their staffing levels to decline over the next six months, according to ABC’s Construction Confidence Index.”
Ken Simonson, chief economist for the Associated General Contractors of America, noted that Census data showed month-to-month declines in spending for both residential (-0.4%) and nonresidential (-0.2%) from June to July, but pointed out nearly all nonresidential segments saw increases on a year-over-year basis.
Additionally, a survey from the AGC found a staggering 94% of respondents — made up of firms that do all kinds of construction except single-family — had openings for hourly craftworkers at the end of June, a 9% increase from a year ago. And over nine in 10 contractors that are hiring are having trouble finding workers, AGC found.
“I think the Census data and AGC survey results both suggest that the ostensible weakening demand for workers is confined to residential construction and select segments of nonresidential (notably office and warehouse construction),” Simonson told Construction Dive via email. “On balance, nonresidential construction firms are still eager to hire and still having difficulty finding qualified workers.”
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