Nonresidential Construction Employment Down Slightly in November

The nonresidential construction sector lost 300 jobs in November, according to a Dec. 3 employment report by the U.S. Labor Department. Year-over-year, nonresidential construction is down 7,600 jobs, or 1.1 percent, and employment stands at 685,700 jobs.

“Construction jobs fell again in November, indicating the equilibrium between supply and demand has yet to be achieved,” said Associated Builders and Contractors (ABC) Chief Economist Anirban Basu. “Many firms have been working hard to retain their key employees through various mechanisms, such as bidding low on contracts just to secure work and stay busy. This cannot persist indefinitely and eventually, firms that continue to lose money will falter. Specialty trade contractors are particularly vulnerable, because one project that goes awry is often enough to end a firm’s existence. With many firms continuing to fail, construction employment has been declining as a reflection of diminishing industry capacity.”

Heavy and civil engineering construction employment grew for the sixth straight month in November, gaining 1,300 jobs over October. That sector has gained a total of 23,800 jobs, or 2.9 percent, compared to the same time last year. The specialty trade construction sector lost 6,800 jobs in November and 102,100 jobs, or 2.8 percent, over the last 12 months.

Residential construction gained 500 jobs in November but is still down 31,300 jobs, or 5.2 percent, compared to one year ago. The construction industry as a whole lost 5,000 jobs in November following a 3,000 job increase in October. Compared to one year ago, the industry has 117,000 fewer jobs, a 2 percent decrease. The national unemployment rate for the construction industry was 18.8 percent in November, up significantly from the 17.3 percent unemployment rate in October, but still lower than November 2009 when it stood at 19.4 percent.

Private employment was up for the 11th month, increasing by 50,000 jobs in November for a total increase of 1,088,000 jobs year over year. Overall national employment increased by 39,000 jobs in November, but with 11,000 jobs lost in the public sector for the month. Year over year, the nation has gained 842,000 jobs; however, the national unemployment rate is still high at 9.8 percent.

“A caveat to today’s jobs numbers may be that the government’s statistical approach to seasonal factors has served to make November look worse than it was,” Basu said. “However, today’s employment report is perfectly consistent with ABC’s prior statements regarding the still moderate pace of economic recovery in America.”