Construction employment increased by 51,000 jobs in December, with gains for nonresidential as well as residential contractors, according to an analysis by the Associated General Contractors of America of government data released today. Association officials cautioned, however, that its latest survey shows widespread pessimism among contractors about the volume of work available in 2021, and they urged lawmakers to focus on measures designed to rebuild the economy and demand for construction.
“December’s employment gains likely reflect milder weather than usual for the month rather than sustained demand for projects,” said Ken Simonson, the association’s chief economist. “In fact, our survey found contractors expect the volume of work is likely to decline for nearly all nonresidential project types, and most firms have experienced project cancellations or postponements.”
Construction employment climbed to 7,413,000 in December, an increase of 0.7% compared to November. However, employment in the sector remains down by 226,000 or 3.0% since the most recent peak in February.
Residential construction has weathered the pandemic much better than nonresidential segments, Simonson added. While both parts of the industry had huge job losses from the pre-pandemic peak in February to April, residential building and specialty trade contractors have now recouped all of the employment losses they incurred. In contrast, nonresidential construction employment—comprising nonresidential building, specialty trades, and heavy and civil engineering construction—was 241,000 lower in December than in February.
Unemployment in construction nearly doubled in 2020. The industry’s unemployment rate in December was 9.6%, compared to 5.0% in December 2019. A total of 930,000 former construction workers were unemployed, up from 489,000 a year earlier. Both figures were the highest for December since 2013.
The association’s 2021 Construction Hiring and Business Outlook Survey found that 78% of contractors reported a project had been canceled or postponed, while only 25% reported winning new or additional work as a result of the pandemic, the economist noted. He said that suggests many firms will have to lay off employees once current projects wrap up. The survey included responses from more than 1,300 contractors that perform all types of construction other than homebuilding.
Association officials urged the new Congress and incoming Biden administration to enact measures to boost investments in all manner of public infrastructure. They added that Washington needs to backfill depleted state and local construction budgets so those new federal infrastructure investments can be more effective in boosting demand and construction employment.
“As Washington officials pivot from providing pandemic relief to focusing on rebuilding the economy, infrastructure needs to be at the top of their agenda,” said Stephen E. Sandherr, the association’s chief executive officer. “There is a real chance to come out of the pandemic with a stronger and more efficient economy fs we can act now to rebuild aging and over-burdened infrastructure.”
Related Stories
Market Data | Jun 19, 2019
Number of U.S. architects continues to rise
New data from NCARB reveals that the number of architects continues to increase.
Market Data | Jun 12, 2019
Construction input prices see slight increase in May
Among the 11 subcategories, six saw prices fall last month, with the largest decreases in natural gas.
Market Data | Jun 3, 2019
Nonresidential construction spending up 6.4% year over year in April
Among the 16 sectors tracked by the U.S. Census Bureau, nine experienced an increase in monthly spending, led by water supply and highway and street.
Market Data | Jun 3, 2019
4.1% annual growth in office asking rents above five-year compound annual growth rate
Market has experienced no change in office vacancy rates in three quarters.
Market Data | May 30, 2019
Construction employment increases in 250 out of 358 metros from April 2018 to April 2019
Demand for work is outpacing the supply of workers.
Market Data | May 24, 2019
Construction contractors confidence remains high in March
More than 70% of contractors expect to increase staffing levels over the next six months.
Market Data | May 22, 2019
Slight rebound for architecture billings in April
AIA’s ABI score for April showed a small increase in design services at 50.5 in April.
Market Data | May 9, 2019
The U.S. hotel construction pipeline continues to grow in the first quarter as the economy shows surprising strength
Projects currently under construction stand at 1,709 projects/227,924 rooms.
Market Data | May 9, 2019
Construction input prices continue to rise
Nonresidential input prices rose 0.9% compared to March and are up 2.8% on an annual basis.
Market Data | May 7, 2019
Construction costs in major metros continued to climb last year
Latest Rider Levett Bucknall report estimates rise at more than double the rate of 2018 Growth Domestic Product.