Dive Brief:
- The construction sector added 18,000 jobs in January, and the industry unemployment rate rose to 8.5%, the Bureau of Labor Statistics and Associated Builders and Contractors reported Friday.
- In January, construction employment was at 6,615,000 — the highest number since December 2008, according to the Associated General Contractors of America. The January figure also represents a 264,000-job increase from January 2015 — a 4.2% gain.
- Within the industry, employment in the nonresidential segment declined by 2,300 jobs in January, and the residential segment added 20,100 jobs, according to the AGC.
Dive Insight:
The slowdown in January follows three months of major surges in employment, as construction added 45,000 jobs in December, 46,000 in November, and 31,000 in October.
AGC Chief Economist Ken Simonson said it is not yet clear whether the slowdown in hiring can be attributed to economic uncertainty or construction firms' inability to find qualified workers in the tight labor pool.
AGC CEO Stephen Sandherr said of the report, "Hopefully the nonresidential construction sector is just experiencing a temporary slowdown while investors catch their breath. But if the broader economic recovery continues to slow, the construction industry will have a tough time expanding at the rates we saw late last year."
The slowdown in new construction jobs at the beginning of the year coincides with other reports that industry employers are slightly less optimistic this year than at the start of 2015 about their hiring prospects. In an AGC survey released last month, 71% of respondents said they plan to increase their headcounts in 2016, down from 80% in November. The dip this year is due largely to the ongoing labor shortage, increased competition, additional government regulations, and higher healthcare costs, according to the AGC.
