U.S. construction industry adds 30,000 jobs in October
The U.S. construction industry added 30,000 net new jobs in October, according to an analysis from the Associated Builders and Contractorsof data from the U.S. Bureau of Labor Statistics.
The industry has added 330,000 net new construction jobs over the past 12 months, a 4.7 percent increase. Additionally, nonresidential construction employment grew by 13,500 net new jobs in October, with job growth split evenly between the heavy and civil engineering subsector (+7,100) and nonresidential specialty trade (+7,500).
Construction unemployment dropped to 3.6 percent in October, 0.5 percentage points lower than the previous month, and 0.9 percentage points lower on a yearly basis. National unemployment, which reached a 49-year low last month, remained unchanged at 3.7 percent.
"The fact that the U.S. economy is performing well is hardly a secret," said ABC's Chief Economist Anirban Basu. "Therefore, today's employment numbers may not seem especially newsworthy. They confirm in large measure what we already know. We know that many private employers continue to view the current period as a good one for enterprise expansion. We know that household finances are in good shape, which helps support overall economic growth as well as growth in certain sectors, such as hospitality and retail trade. We also know that workers remain in high demand and that for many businesses, the greatest challenge is securing sufficient levels of human capital.
"Still, today's report supplies some new insight into U.S. economic dynamics," said Basu. "2018 may very well be remembered as the year that infrastructure investment roared back in America. The September nonresidential construction spending numbers confirmed massive increases on spending related to water supply, flood control and transit over the past year. Today's employment release reveals that the heavy and civil engineering segment added another 7,100 jobs last month and has added 52,000 jobs over the past 12 months. This is consistent with ongoing growth in spending on public works and is attributable to a number of factors, including rebuilding from catastrophes that have occurred during the past two years. But this is also a reflection of significantly improved state and local government finances as the recovery works through its 10th year.
"Given elevated backlog, the expectation is that demand for construction workers will remain elevated," said Basu. "One potential cause for concern is growing evidence that wages have begun to rise much more rapidly of late. That, along with other sources of inflation, can be expected to push interest rates higher, which in turn would ultimately translate into more expensive financing for construction projects and fewer construction starts. But for now, it is all systems go for the U.S. nonresidential construction industry.