ABC: Construction unemployment rate improves in 32 states, nationally in September

Dive Brief:

Year-over-year September construction unemployment rates fell in 32 states and dropped 0.3% nationally to a rate of 5.2%, according to an analysis of U.S. Bureau of Labor Statistics data by the Associated Builders and Contractors.
September's unemployment rate, which rose 0.1% from August, nonetheless marked the lowest unemployment rate for that month since September 2000, when it was 4.6%. On a month-to-month basis, construction unemployment rates fell in 18 states.
September's nonseasonally adjusted unemployment numbers show continual improvement in construction employment in 2016. The construction unemployment rate has been on the decline since September 2010, when the rate was 17.2%.

Dive Insight:

According to the ABC, Colorado (2.4%), South Dakota (2.9%), Idaho (3%), North Dakota (3%) and Massachusetts (3.3%) had the lowest construction unemployment rate, with Colorado posting the lowest number on record for that state. Alaska (10.1%), New Mexico (8.6%), Rhode Island (8.5%), Pennsylvania (8.1%) and Alabama (7.6%) had the highest unemployment rates. Alabama and Rhode Island had relatively low unemployment when compared to their recent-year histories, however.

The BLS reported earlier this month that the construction industry added 23,000 new jobs in September, bringing total employment up to 6,669,000, which was a year-over-year increase of 3.4% and the highest number since 2008. The nonresidential and specialty trade (residential) sectors contributed more than 65% to those figures.

The Associated General Contractors of America said that despite adding jobs in September, the industry still struggles to find qualified workers. Despite 69% of companies reporting staffing difficulty, only 48% increased pay rates to attract workers. According to the BLS, construction wages increased 2.8% year over year in September.

The ABC warned that a softening in nonresidential hiring could mean that the industry is in store for a dip in construction activity, particularly in light of tighter credit requirements, the upcoming winter slowdown and developer difficulties in finding tenants for their mixed-use projects.