Construction employment declined by 7,000 between May and June as the industry still employs 238,000 fewer people than before the pandemic, according to an analysis by the Associated General Contractors of America of government data released today. Association officials said that job losses in the nonresidential construction sector offset modest monthly gains in residential construction as many firms struggle with worker shortages, supply chain disruptions and rising materials prices.
“It is hard for the industry to expand when it can’t find qualified workers, key building materials are scarce, and the prices for them keep climbing,” said Stephen E. Sandherr, the association’s chief executive officer. “June’s job declines seem less about a lack of demand for projects and a lot more about a lack of supplies to use and workers to employ.”
Construction employment in June totaled 7,410,000, dropping 7,000 from the revised May total. The total in June remained 238,000 or 3.1% below February 2020, the high point before the pandemic drove construction employment down. The number of former construction workers who were unemployed in June, 730,000, dropped a quarter from a year ago and the sector’s unemployment rate fell from 10.1% in June 2020 to 7.5% this June.
Residential and nonresidential construction sectors have differed sharply in their recovery since the pre-pandemic peak in February 2020. Residential construction firms—contractors working on new housing, additions, and remodeling—gained 15,200 employees during the month and have added 51,000 workers or 1.7% over 16 months. The nonresidential sector—comprising nonresidential building, specialty trades, and heavy and civil engineering contractors—shed 22,600 jobs in June and employed 289,000 fewer workers or 6.2% less than in February 2020.
Sandherr noted that many firms report key materials are backlogged or rationed, while also reporting frequent increases in the amount they pay for those materials. In addition, many firms report they are having a hard time finding workers to hire despite the relatively high number of people currently out of work. He added these factors are contributing to rising costs for many contractors, which are details in the association’s updated Construction Inflation Alert.
Association officials said they were taking steps to recruit more people into the construction industry. They noted the association launched its “Construction is Essential” recruiting campaign earlier this year. They said Washington officials could help the industry by taking steps to ease supply chain backups. They also continued to call on the President to remove tariffs on key construction materials, including steel.
“The good news is there are large numbers of qualified workers available to hire who are on the sidelines until schools reopen and the federal unemployment supplements expire,” said Stephen E. Sandherr, the association’s chief executive officer. “Our message to these workers is clear, there are high-paying construction careers available when they are ready.”
Related Stories
Market Data | Jul 27, 2020
6 must reads for the AEC industry today: July 27, 2020
Customized labs give universities a recruiting edge and the U.S. construction pipeline remains robust through the first half of 2020.
Market Data | Jul 27, 2020
The U.S. construction pipeline remains robust through the first half of 2020, despite pandemic
Projects currently under construction stand at 1,771 projects/235,467 rooms, up 3% and 1% respectively, YOY.
Market Data | Jul 24, 2020
5 must reads for the AEC industry today: July 24, 2020
North Carolina will stop relying on FEMA flood mapping and Cal Poly Pomona's newest project.
Market Data | Jul 23, 2020
New LEED guidance from USGBC helps cities and communities expand resilience efforts in response to the COVID-19 pandemic
Credits integrate public health and social equity with sustainability planning.
Market Data | Jul 23, 2020
6 must reads for the AEC industry today: July 23, 2020
Skanska selects Pickard Chilton to design new ofice tower and days grow long at nursing homes as virus lockdowns drag on.
Market Data | Jul 22, 2020
6 must reads for the AEC industry today: July 22, 2020
Phase one of Toronto's The Orbit detailed and architecture billings remains in negative territory.
Market Data | Jul 21, 2020
Nonresidential building spending to decline through 2021
The commercial building sector is expected to be the hardest hit.
Market Data | Jul 21, 2020
7 must reads for the AEC industry today: July 21, 2020
Abandoned high-rise becomes mixed-use luxury apartments and researchers are developing anti-coronavirus tech for buildings.
Market Data | Jul 20, 2020
Construction employment rises from May to June in 31 states, slips in 18
Recent data from Procore on jobsite workers’ hours indicates employment may have leveled off.
Market Data | Jul 20, 2020
6 must reads for the AEC industry today: July 20, 2020
Never waste a crisis and robotic parking systems help developers optimize parking amenities.