Nonresidential Construction Sector Posts First Job Gain Since March

Sector Has Yet to Hit Pre-Pandemic Levels Amid Supply Chain Disruptions & Delays

October 08, 2021

The construction industry gained 22,000 jobs between August and September as nonresidential construction firms added employees for the first time in six months, according to an analysis by the Associated General Contractors of America of government data released Oct. 8. Association officials said nonresidential construction has been affected by the widespread supply chain problems, which are causing owners already uncertain about future demand for commercial space to delay or even cancel some projects.

“While it is refreshing to see job gains in both residential and nonresidential construction, nonresidential building and infrastructure employment remains far below its pre-pandemic peak,” said Ken Simonson, the association’s chief economist. “It will take more than a few months of gains to match the overall economy.”

Construction employment in September totaled 7,447,000, an increase of 22,000 since August. However, industry employment remained 201,000 below the pre-pandemic peak set in February 2020.

The nonresidential segment, comprising nonresidential building and specialty trade contractors plus heavy and civil engineering construction firms, added 18,600 employees in September. But nonresidential employment is 281,000 below the February 2020 level, as the sector has recovered only 56% of the jobs lost in the first two months of the pandemic.

Residential construction—including building contractors such as homebuilders, along with residential specialty trades—added 3,600 employees in September. Residential employment tops the February 2020 mark by 80,000.

Simonson cited an unending series of supply-chain bottlenecks, as well as extreme price increases and long lead times for a variety of construction materials, as threats to further growth of nonresidential construction. He said he had heard about an increasing number of project owners deciding to postpone projects because of excessive cost increases and lead times. He noted that the association has again updated its Construction Inflation Alert, a guide to inform owners, officials and others about the cost and supply-chain challenges.

View the construction employment chart and table.