"Despite disappointing monthly nonresidential numbers, the data remain positive on a year-over-year basis."—ABC Chief Economist Anirban Basu.
The U.S. construction industry added 12,000 jobs in October, according to the Bureau of Labor Statistics (BLS) preliminary estimate released Nov. 7. September’s estimate was revised upward from 16,000 to 19,000 net new jobs. Nonresidential construction slipped in October, losing 1,900 jobs on a monthly basis.
"Recent data regarding nonresidential construction activity have been a bit disappointing," said Associated Builders and Contractors Chief Economist Anirban Basu. "Most contractors seem to be suggesting that their business prospects have been improving and are likely to continue to do so. However, the most recent readings on nonresidential construction spending and nonresidential construction employment have suggested a slowing in the rate of expansion. In fact, according to BLS, the nation’s nonresidential construction sector actually shed jobs in October."
The national construction unemployment rate dropped from 7 percent to 6.4 percent on a non-seasonally adjusted basis in October, reaching its lowest level since November 2007.
"Despite disappointing monthly nonresidential numbers, the data remain positive on a year-over-year basis," said Basu. "The construction unemployment rate declined meaningfully in October, indicating that part of the lack of job growth may be attributable to growing difficulties securing skilled talent. This, in combination with ongoing malaise in public sector construction spending, is likely at the heart of October’s disappointing nonresidential construction employment figures."
According to the BLS household survey, the national unemployment rate inched down to 5.8 percent in October and has now fallen in three consecutive months. For the past two months, the falling unemployment rates have been a function of a shrinking labor force. However, that was not the case in October. The labor force expanded by 416,000 persons for the month, ticking up to 62.8 percent.
Construction employment for the month and the past year breaks down as follows:
•Nonresidential building construction employment fell by 1,800 jobs for the month but is up by 18,200 jobs, or 2.7 percent, since October 2013.
•Residential building construction employment fell by 2,300 jobs in October but is up by 49,900 jobs, or 8 percent, on an annual basis.
•Nonresidential specialty trade contractors lost 100 jobs for the month but employment in that category is up by 43,300 jobs, or 2.1 percent, from the same time one year ago.
•Residential specialty trade contractors gained 10,300 jobs in October and have added 80,700 jobs, or 5.2 percent, since October 2013.
•The heavy and civil engineering construction segment added 5,500 jobs in October and job totals are up by 38,300, or 4.3 percent, on a year-over-year basis.
To view the previous employment report, click HERE.