Construction employment climbs to 8-year high as firms add 11K jobs in October

Dive Brief:

The construction industry added 11,000 jobs in October, the Bureau of Labor Statistics reported Friday. October's total construction employment of 6,679,000 marked the highest level since December 2008.
Within the industry, the residential sector added 4,500 jobs last month, while the nonresidential sector added 6,700 positions, according to the Associated General Contractors of America.
Year-over-year construction employment was 3.0% higher last month than in October 2015. Average hourly earnings in construction rose 3.2% in the past year to $28.39 in October — almost 10% higher than the average across all private sector industries.

October 2016 construction employment chart — Bureau of Labor Statistics

Dive Insight:

The labor shortage has been a consistent concern for the construction industry, as 69% of firms surveyed in an August AGC report said they are struggling to find hourly craft workers. As a result of the skilled worker shortage, 48% of companies in the survey said they have increased pay for hourly craft workers. That trend was reinforced by the significant gains in average October construction employee wages in the BLS report.

However, the AGC has emphasized the dual nature of the construction industry right now. On one hand, the private sector is experiencing strong demand and difficulty finding workers to keep up with the pace of projects. On the other hand, public sector spending has lagged behind as governments at all levels struggle to fund infrastructure projects.

"Overall construction employment would certainly be higher if local, state and federal officials were investing more to build new and repair aging infrastructure," AGC Chief Economist Ken Simonson said in a release. The AGC and other construction groups have continued their calls for an increase in funding for public projects.

While some onlookers have expressed concern that a bump in infrastructure spending would exacerbate the construction labor shortage, AGC officials said the lagging public sector still has room to bring on more workers. While the private sector has been draining the pool of skilled workers, contractors on government-funded projects haven't needed to meet the same level of demand.

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