Federal spending cuts may be a contributor, say AGC officials.
An analysis by the Associated General Contractors of America (AGC) of recent figures from the Labor Department finds that construction employment declined in 32 states and the District of Columbia in April even as 29 states added jobs between April 2012 and April 2013. AGC officials note that construction demand in a number of states appears to be slackening amid cuts in federal construction spending and relatively weak private sector demand.
“The industry shows signs of recovering, but employment growth continues to be uneven, with some areas seeing stronger gains, even as others continue to contract,” says Ken Simonson, the AGC’s chief economist. “In addition, recent federal construction spending cuts amid still modest private sector growth is making it hard for the industry to recover in more areas.”
In a release, Simonson notes that Illinois had the largest decline in construction employment between March and April (-7,900 jobs, -4.3percent). Other states that saw sharp declines in construction employment include New York with a loss of 6,600 jobs, a 2 percent decline; and Wisconsin, which realized a loss of 3,900 jobs and a 4.1 percent decline. The AGC adds that Vermont had the highest percentage decrease in construction employment a 6.3 percent drop), followed by Illinois and Wisconsin.
On the positive side, the figures from the Labor Department notes that 17 states have added construction jobs between March and April. Florida added the largest number of construction jobs (9,000 jobs, 2.6 percent), while Connecticut had the highest percentage increase (2,100 jobs for a 3.9 percent increase). The second largest number of construction-related jobs took place in California (7,400 jobs, 1.2 percent), followed by Texas (6,000 jobs, 1.0 percent). Mississippi had the second-highest percentage increase (3.1 percent, 1,500 jobs), followed by West Virginia (2.9 percent, 1,000 jobs).
Simonson reports that 29 states added construction jobs from April 2012 to April 2013 and 21 states and D.C. states lost workers. Hawaii led all jurisdictions in the percentage of new construction jobs with an increase of 11.5 percent; followed by Alaska, up 9.1 percent; and Louisiana, which saw an increase of 8.1 percent. California added the most new construction jobs over the past 12 months (44,800, 7.7 percent), followed by Texas (41,500 jobs, 7.1 percent).
Among the states losing construction jobs during the past year, Vermont saw the biggest loss, -11.3 percent; followed by South Dakota, down 9.6 percent; and Rhode Island, declining 8.6 percent. Illinois lost the most jobs -12,900 jobs, followed by Ohio with a loss of 9,200 jobs and Indiana with a loss of 5,600 jobs.
In response to the most recent numbers, AGC officials are urging Congress and the administration to reconsider what it describes as “its current approach of making indiscriminate, across-the-board cuts to a range of federal construction programs.”
In a statement, the AGC points out that a broader economic impact of declining construction employment in most states will cost more in lost activity and revenue than the cuts were likely to save. The AGC also urged officials to act quickly to enact long-term legislation to fund repairs to locks, waterways and flood protection.
“While the industry ultimately needs broader private sector demand to truly recover, boosting infrastructure investments will certainly help,” says Stephen Sandherr, the AGC’s CEO. “The last thing Washington should be doing is taking steps that undermine the sector's nascent recovery.”