Construction Firms Add 17,000 Jobs in May; Unemployed Workers Drops to 10-Year May Low

Construction firms added 17,000 jobs in May and 273,000 over 12 months, as the sector’s unemployment rate fell to 6.7 percent, the lowest May rate since 2006, according to an analysis by the Associated General Contractors of America. Association officials noted that the job gains come as the private and public sectors are increasing investments in construction services.

“Construction employers continue to expand headcount as they adjust to growing demand for their services in many parts of the country,” said Ken Simonson, the association’s chief economist. “Right now the two most likely obstacles to the industry’s continued expansion are growing labor shortages and political gridlock that could curtail public sector investments in infrastructure and construction.”

Construction employment totaled 6,387,000 in May compared to 6,370,000 in April and 6,114,000 in May 2014, Simonson noted. Construction employment is at its highest level since February 2009, the economist added. Residential building and specialty trade contractors added 8,500 jobs (0.3 percent) since April and 149,300 jobs (6.5 percent) over 12 months. Within the residential sector, residential building contractors added 1,800 jobs for the month while residential specialty trade contractors added 6,700 jobs compared to April.

Nonresidential contractors—building, specialty trade and heavy and civil engineering construction firms—hired a net of 8,600 workers for the month and 124,300 (3.3 percent) since May 2014. As with the residential sector, nonresidential employment sector gains varied by segment. Nonresidential specialty trade contractors added 5,600 jobs for the month while heavy and civil engineering contractors—who typically perform public-sector projects like highway construction—only added 400 jobs since April. Nonresidential building construction employment increased by 2,600 for the month and is up 19,500 (2.8 percent) for the year.

Simonson added that the number of unemployed construction workers, 569,000, is at the lowest May level since 2005. Construction officials noted that many construction workers left the industry during the recent downturn to pursue jobs in faster growing sectors or retire, while few new workers have entered the profession as the number of vocational educational opportunities has declined during the past several decades.
Association officials added that the two most obvious threats to future construction growth are tight labor markets and political gridlock that could curtail public-sector construction spending. They urged Congress to act quickly to fund and pass surface transportation legislation to invest in the nation’s aging roads, bridges and transit systems. And they called on federal, state and local leaders to act on measures outlined in the association’s Workforce Development Plan designed to expand career and technical education opportunities for young people.

“The two most likely threats to the construction sector are problems that can be fixed as long as our elected and appointed officials are willing to fund infrastructure and create new educational opportunities for our youth,” said Stephen E. Sandherr, the association’s CEO.