Construction employment lost 7,000 jobs on net in August, according to Associated Builders and Contractors. On a year-over-year basis, the industry has expanded by 58,000 jobs鈥攁n increase of 0.7%.
The construction unemployment rate dropped to 3.2% in August. The national unemployment rate for all industries rose from 4.2% in July to 4.3% in August as the U.S. economy added 22,000 jobs.
Nonresidential construction lost 1,200 jobs in August, with losses in two of three subsectors. Heavy and civil engineering added 2,300 jobs; nonresidential specialty trade contractors lost 200 jobs; and nonresidential building lost 3,300 jobs.
鈥淭he construction industry has now lost jobs in each of the past three months,鈥 said ABC Chief Economist Anirban Basu. 鈥淚ndustrywide employment is up by just 6,000 positions since December, and every subsegment except for heavy and civil engineering lost jobs in August. Despite these job losses, construction labor shortages appear to be worsening as immigration policy weighs on the supply of workers; the construction unemployment rate fell to 3.2% in August, matching the lowest level ever recorded.
鈥淐onstruction industry data have been particularly downbeat since March,鈥 Basu continued. 鈥淲ith materials prices rising and construction spending shrinking, it鈥檚 hardly a surprise that the industry鈥檚 workforce is contracting. Despite these troubling signs, contractors remain optimistic about their sales over the next six months, according to ABC鈥檚 Construction Confidence Index. While that may reflect the notion that weak labor market data will translate into accelerated rate cuts, there is no guarantee that a lower federal funds rate will translate into lower borrowing costs given the current state of the bond market.鈥
