Dive Brief:

• Construction employment growth stayed virtually the same in October, adding 11,000 net new jobs, the Bureau of Labor Statistics reported Friday.
• The month's total construction employment of 6.93 million represented a 187,000-position — or 2.8% — increase from October 2016, according to the Associated Builders and Contractors (ABC).
• Within the industry, specialty trade contractors across the residential and nonresidential sectors drove October's employment growth, adding 10,400 new jobs last month. The residential sector added 7,200 new positions for the period, while the nonresidential sector (including heavy civil and engineering) lost 3,300 jobs. 

Dive Insight:

The month's ebb in employment, particularly in the nonresidential sector, points to a growing cause for concern in the industry's lagging ability to recruit qualified workers.

Though construction activity may have slipped slightly in October, pushing down the month's employment figures, the stronger likelihood, according to the ABC, is that companies losing employees to retirement or less demanding industries aren't able to find the replacements needed to fill out their workforce. Those companies, too, could be seeing a slowdown resulting from projects interrupted by the recent hurricanes.

Recent spending figures also suggest a continued slowdown in industry activity. That number has trended downward for much of the last year, though September's report showed slight overall growth in the category and represented a 2% increase year-over-year.

A break in the year's upward trend in architecture billings could also mean a change of pace for employment. The measure dipped below positive territory for the first time in seven months in September, though strong readings in new project inquiries and new design contracts have analysts hopeful for robust activity in the coming months.

Employment could change course in the coming months as rebuilding efforts get underway full force. Still, the skilled labor shortage will likely complicate such efforts with seven in 10 contractors reporting difficulty finding enough qualified workers even before the storms, according to an Associated General Contractors of America survey.

While the industry attempts to recalibrate heading into the year's end, analysts expect both employment and spending to tick up in response to a strong and stabilizing construction backlog.