Construction Unemployment Rate Hits 27.1 Percent

The construction unemployment rate jumped to 27.1 percent and construction employment dropped to a 14-year low as another 64,000 construction workers lost jobs in February, according to federal employment figures cited in a news release from the Associated General Contractors of America (AGC). The economy would have added jobs for the third time in four months had it not been for declines in construction employment, the AGC notes.

“While the broader economy may be recovering, the construction industry continues to decline at an alarming rate,” says Ken Simonson, the association's chief economist. “If these trends don't change soon, millions of American families will continue to suffer.”

Simonson notes that the industry's job losses in February were consistent with the prior six months and not mainly attributable to exceptionally bad weather. He adds that construction unemployment is at the highest level recorded since the federal government began making the data available in 1976. Nonresidential construction experienced significantly more job losses than the residential sector in February, 53,500 jobs lost versus 10,600, Simonson adds.

Overall declines in construction activity have cost 2.2 million construction workers their jobs since industry employment peaked in June 2006, a 28 percent drop, Simonson says. Construction has accounted for 1,936,000 of the 8,425,000 nonfarm payroll job losses since the recession began in December 2007, or 23 percent of the total, even though the industry employs only 4.3 percent of all workers, he adds.

Nonresidential specialty trade contractors experienced the largest monthly decline of 1.7 percent, while heavy and civil engineering construction, the sector most likely to be boosted by stimulus funded projects, experienced a 1.1 percent monthly employment decline, according to Simonson.