Construction Industry Job Report Shows Mixed Signs

(October 22, 2012) — Construction employment declined in 28 states from September 2011 to September 2012 even as 30 states added jobs during the past month, according to an analysis by the Associated General Contractors of America of Labor Department data. Association officials noted that the monthly gains, while welcome, were too small to offset the larger annual declines in many states.

“Even though a good number of states added jobs in September, most states have a smaller construction workforce than they did a year ago,” said Ken Simonson, the association’s chief economist. “Between the fiscal cliff, unset tax rates and declining public sector investments, there are a lot of construction projects on hold as owners wait for a clearer picture of where the economy is heading.”

Among states losing construction jobs during the past year, Alaska lost the highest percentage (-16.1 percent, -2,400 jobs), followed by New Jersey (-10.2 percent, -13,400 jobs) and Nevada (-9.4 percent, -5,000 jobs). New Jersey lost the most jobs, followed by New York (-12,500, -4.1 percent), Pennsylvania (-9,100 jobs, -4.1 percent), North Carolina (-8,400 jobs, -4.7 percent) and Illinois (-8,400 jobs, -4.4 percent).

Simonson noted that 22 states and the District of Columbia added construction jobs between September 2011 and September 2012. The District of Columbia added the highest percentage of new construction jobs (12.5 percent, 1,500 jobs), followed by Nebraska (11.1 percent, 4,500 jobs) and North Dakota (11.0 percent, 2,800 jobs). Texas added the most new construction jobs over the past 12 months (32,800, 5.9 percent), followed by California (25,700, 4.7 percent) and Indiana (6,300, 5.0 percent).

New Jersey (-3.4 percent, -4,200 jobs) had the steepest percentage decline among the 19 states that lost construction jobs for the month, followed by the District of Columbia (-2.9 percent, -400 jobs) and Delaware (-2.8 percent, -500 jobs). The largest number of construction job losses in September occurred in New York (-4,700 jobs, -1.6 percent), followed by New Jersey and Texas (-4,100 jobs, -0.7 percent). Construction employment levels were unchanged for the month in Arkansas and Nebraska.

The highest percentage construction employment gains for the month occurred in Missouri (4.5 percent, 4,300 jobs), followed by Iowa (3.5 percent, 2,200 jobs) and Alaska (3.3 percent, 400 jobs). Missouri added the most jobs during the month, followed by Florida (4,200 jobs, 1.3 percent) and Michigan (2,700 jobs, 2.3 percent).

Association officials said that construction employment was suffering because of Washington’s failure to act on a range of tax, spending and infrastructure programs. They added that the political uncertainty wasn’t just affecting the public sector market, with construction firms reporting many private sector projects appear to be on hold until Congress sets tax rates, addresses the fiscal cliff and acts on vital infrastructure measures.

“A lot of businesses are wary of investing in new construction activity when they don’t know where the economy is heading or even what tax rates they will have to pay next year,” said Stephen E. Sandherr, the association’s chief executive officer. “Economies don’t thrive amid uncertainty and inaction.”