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Construction Employment Rises by 1,000 in November and 146,000 in 12 Months


Slowing job gains may be sign of labor shortages, not slumping demand, according to the Associated General Contractors.

    

Construction employment increased by 1,000 jobs in November and by 146,000, or 2.0 percent, over the past 12 months, according to an analysis of new government data by the Associated General Contractors of America. AGC officials said recent modest monthly increases in industry employment likely reflect the difficulty contractors are having in finding workers rather than a letup in demand. Officials urged federal officials to pass the JOBS Act and boost funding for career and technical education programs to help ease labor shortages.

    

“Contractors report they remain busy and have lots of projects on their order books,” said Ken Simonson, AGC’s chief economist. “But they find it extremely difficult to fill many positions despite paying more than other industries. That’s not surprising, given that the total unemployment rate returned to a 50-year low in November—a sign that all industries are competing for workers.”

    

Simonson observed that the average weekly hours for all employees in construction increased from 38.7 in November 2018 to 39.1 in November 2019, even though construction employment rose by 2.0 percent over the year. In contrast, weekly hours for the overall private sector remained flat at 34.4 hours, while total nonfarm employment increased by 1.5 percent.

    

“One takeaway from these numbers is that contractors are adding workers faster than other sectors, but they are eager to hire even more people to keep pace with strong demand for projects,” Simonson commented. “To make up for the shortfall, many firms are asking workers to put in more hours.” The construction economist noted that it will be difficult for firms to continue asking existing staff to compensate for labor shortages in the long run.

    

Average hourly earnings in construction—a measure of all wages and salaries—increased 2.7 percent over the year to $31.08. That figure was 10.2 percent higher than the private-sector average of $28.29, the AGC official noted.

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