Summary
The nation’s nonresidential building construction employment sector suffered further decline in December losing 6,800 jobs, according to the January 9 employment report by the U.S. Labor Department. For all of 2008, nonresidential building construction shed 53,400 jobs – the largest loss since 1991.
Meanwhile, residential building construction lost another 19,200 jobs in December and 120,400 jobs in 2008. For total construction employment, which includes specialty trade contractors, December saw a drop of 101,000 jobs, the largest one month loss since July 1974. For all of 2008, 632,000 jobs, or 8.5 percent, were lost in total construction (see graph).
Overall, national employment lost 524,000 in December and 1,108,000 jobs in the past two months. The national unemployment rate rose to 7.2 percent – the highest level in nearly 16 years.
What This Means
"Today’s employment numbers are consistent with the notion that the economy continues to deteriorate rapidly, including the construction industry," said Anirban Basu, Associated Builders and Contractors’ (ABC) Chief Economist. "To put this into context, 1.9 percent of nonfarm jobs were lost in 2008. Total construction job loss fell to 8.5 percent, nonresidential construction dropped 6.7 percent and residential suffered the biggest blow falling 13.3 percent.
"However, there is a positive aspect to today’s report," noted Basu. "As the employment data and other statistics continue to reflect the ongoing, seemingly limitless retrenchment in economic activity, the chances for a major stimulus package emerging from the incoming Obama administration and the new Congress improves.
"Remarkably, future jobs reports could be even worse," added Basu. "Today’s jobs report reflects employer decisions largely made prior to Christmas. But, with the holiday season behind us, many employers who had been postponing layoffs now have less reason to do so."