The construction industry added 42,000 net new jobs in February, according to an Associated Builders and Contractors (ABC) analysis of data released March 6 by the U.S. Bureau of Labor Statistics. On a year-over-year basis, industry employment has expanded by 223,000 jobs, an increase of 3 percent.
Nonresidential construction employment increased by 19,800 jobs on net in February and is up by 139,000 net jobs over the last 12 months. There were job gains in all three nonresidential segments, with the largest increase in nonresidential specialty trade contractors, which added 13,400 jobs.
The construction unemployment rate was 5.5 percent in January, down from 0.7 percentage points from the same time last year. Unemployment across all industries declined back to 3.5 percent last month, effectively a 50-year low.
“Seldom is there a jobs report that tells us less about the direction of the U.S. economy than this one,” says Anirban Basu, ABC’s chief economic. “While there is scarcely any evidence of coronavirus impact in today’s employment release, clearly, the trajectory of financial markets and the broader economy has shifted markedly over the last two weeks. While the level of construction activity is unlikely to be fundamentally altered in the near-term—except for when sick workers are asked to stay home—these impacts will eventually catch up to the nation’s construction sector.”
Basu says that with many corporate entities and households deeply indebted to the coronavirus public health crisis, a fragility in the U.S. economy is now being exposed.
“Not only will this translate into a surge in bankruptcies as the crisis deepens, but it will also result in generally weaker balance sheets, which could eventually impact design work and construction starts,” he says.