"Based on today’s report, it remains unlikely that job losses will end on a monthly basis until well into next year." —ABC Chief Economist Anirban Basu
Reflecting the national trend, nonresidential building construction lost 3,200 jobs in October, according to the November 6 employment report by the U.S. Labor Department. On a year-over-year basis, nonresidential building construction employment is down 107,900 jobs, or 13.3 percent, and now stands at 706,400.
Employment with nonresidential specialty trade contractors continues to get hit the hardest with 30,200 jobs lost in October and 441,000 jobs, or 17.4 percent, lost since October 2008. In the heavy and civil engineering construction sector, employment decreased by 13,700 for the month and 129,400 jobs, or 12.6 percent, on a year-over-year basis.
Meanwhile, despite the recent uptick in residential construction spending, the homebuilding sector shed 5,600 jobs for the month and 123,300 jobs, or 15.5 percent, since last October.
Over the past 12 months, total construction employment has shrunk by 15.6 percent losing 1,100,000 jobs, with 62,000 jobs lost last month alone.
The nation’s unemployment rate now stands at 10.2 percent – the highest level in 26 years. Last month, employers shed 190,000 jobs and 5,504,000 jobs, or 4.0 percent, have been lost since October 2008.
What This Means
“The headlines that will emerge from the October employment report will undoubtedly be fixated upon the fact that unemployment is now above 10 percent,” said Associated Builders and Contractors (ABC) Chief Economist Anirban Basu. “National unemployment is now at its highest level since April 1983. As a result, the markets are aware that consumer confidence will likely sag in the wake of this jobs report and that is not conducive to an improved corporate earning environment.
“However, there were some reasonably positive elements to the employment report. The three month average of national job loss is now down to 188,000 – the lowest it has been since August 2008,” said Basu.
“Further, the pace of job loss by nonresidential building contractors has slowed sharply with just 3,200 jobs lost last month. Professional and business services, an important engine of income growth in recent decades, added jobs for the second straight month, and for the first time since December 2007. In addition, temporary jobs, seen as a leading indicator for permanent employment, grew significantly,” said Basu.
“Unfortunately, at least two key segments of the nonresidential construction industry continue to experience significant job decline,” said Basu. “Despite stimulus spending, heavy and civil engineering construction and specialty trade contractors are still losing jobs. Based on today’s report, it remains unlikely that job losses will end on a monthly basis until well into next year.”