Summary
The nation’s nonresidential building construction sector in November experienced a steep decline in employment losing 12,900 jobs, according to the Dec. 5 employment report by the U.S. Labor Department. Since November 2007, nonresidential building construction has lost 54,400 jobs, or 6.8 percent. Further, the grim news is compounded by revised numbers for September in which 12,100 jobs were lost and 7,200 jobs were lost in October of this year.
Residential building construction lost 6,400 jobs in November and 104,100 since the same time last year. Total private construction employment, which includes specialty trade contractors, lost 82,000 jobs last month and 568,000 jobs, or 7.6 percent, since November 2007 (see graph below).
Overall, national employment lost 533,000 jobs from the previous month. In addition, September and October job loss figures were revised to 403,000 and 320,000, respectively, netting a three-month job loss total to 1.25 million. The national unemployment rate has hit a 34-year high and now stands at 6.7 percent.
What This Means
"With each passing month, the growing weakness of the nation’s economy is impacting the nonresidential construction sector," said Anirban Basu, Associated Builders and Contractors (ABC) Chief Economist. "Earlier this decade, job losses in the construction industry were primarily associated with losses among residential builders. But that is no longer the case.
"Jobs in the commercial and industrial construction sector have held up well in recent years and this has been reflected in past employment numbers, but the November data now indicates that nonresidential construction is responsible for the majority of construction job losses," added Basu.
"In other words, the loss of residential construction jobs was a leading indicator for the overall economy, while the loss in nonresidential construction jobs has been somewhat of a lagging indicator," said Basu. "Given that, it seems commercial and industrial construction employment levels are poised to decline well into 2009, and possibly throughout the entire year."
