Hurricane Recovery Helps Construction Unemployment Rate Hit Lowest October Mark on Record

Washington, Nov. 28—The not seasonally adjusted (NSA) national construction unemployment rate was 4.5 percent in October, down 1.2 percent from a year ago, the U.S. Bureau of Labor Statistics (BLS) reported. It was the lowest October rate on record, matching the rate in 2006, according to analysis released today by Associated Builders and Contractors (ABC). Further, the construction industry employed 180,000 more workers than in October 2016.

Construction unemployment rates were also down in 44 states on a year-over-year basis, unchanged in one (South Dakota) and up in five states.

“Recovery from the various hurricanes that hit the United States appeared to be a major factor in October construction employment. Some northern states that would normally have an increase in their NSA construction unemployment rate had flat or down rates. This is likely due to some construction workers leaving those states to help with hurricane recovery,” said Bernard M. Markstein, Ph.D., president and chief economist of Markstein Advisors, who conducted the analysis for ABC. “The need for construction workers as part of recovery and rebuilding efforts after this year’s devastating hurricanes, floods and wildfires is providing employment for workers who normally would be subject to seasonal layoffs.”

Because these industry-specific rates are not seasonally adjusted, national and state-level unemployment rates are best evaluated on a year-over-year basis. The monthly movement of the rates still provides valuable information, although extra care must be used in drawing conclusions from these monthly movements.

From the beginning of the data series in 2000 through 2016, the monthly movement in the national NSA construction unemployment rate from September to October has recorded a decrease five times and an increase 12 times. This year, the rate was down 0.2 percent from September. Among the states, 25 had decreases in their October estimated rate from September, 21 were up and four (California, Louisiana, Oklahoma and Pennsylvania) had no change.

The Top Five States
The states with the lowest estimated October NSA construction unemployment rates in order from lowest to highest were:
1.    Hawaii, 2 percent
2.    Idaho, 2.3 percent
3.    Colorado, 2.5 percent
4.    Vermont, 2.7 percent
5.    Iowa, 2.8 percent

Hawaii’s number one ranking was a jump from 16th lowest in September, tied with Kansas and North Carolina. It was the state’s lowest October rate since the beginning of the estimates in 2000. Further, Hawaii had the largest monthly drop and the fifth largest year-over-year decline in its rate among the states.

Note that Hawaii’s unemployment rate is a rate for construction, mining and logging combined. The data to estimate a construction unemployment rate alone are not available for either Hawaii or Delaware.

Idaho and Colorado, which were in the top five in September, remained in the top five in October. This was Idaho’s lowest October estimated rate on record. Colorado slipped a few spots—it had September’s lowest construction unemployment rate. Nonetheless, this was the state’s second lowest October rate on record, after its 2.2 percent rate in 2000.

Vermont’s fourth place ranking in October was up from the eighth lowest rate in September (tied with Oregon and Virginia). It was the state’s lowest October rate on record, matching its 2014 rate.

Iowa made a big improvement in October. The state had the third largest drop in its rate from September, when it had the 22nd lowest rate. This was also its lowest estimated October rate on record.

North Dakota, which ranked third lowest in September based on revised data (previously reported as the second lowest rate), tied with Massachusetts and Texas for seventh lowest, with a 3 percent October estimated NSA construction unemployment rate.

Nebraska, which ranked second lowest in September based on revised data (previously reported as the third lowest rate), fell to the 16th lowest rate, tied with Wyoming. Wyoming had the fifth lowest rate in September.

The Bottom Five States
The states with the highest October NSA construction unemployment rates in order from lowest to highest were:
46.    Pennsylvania, 6.4 percent
47.    New Jersey, 6.5 percent
48.    Illinois, 7.1 percent
49.    New Mexico, 8.4 percent
50.    Alaska, 15 percent

Three of these states—Alaska, Illinois and New Mexico—were also among the five states with the highest construction unemployment rates in September. Alaska had the highest rate in the nation for the third month in a row. The state also had the largest monthly increase, up 4.8 percent from September, and the largest year-over-year increase, up 1.6 percent.

For the third consecutive month, New Mexico had the second highest rate in the country. It was also the eighth month in a row that the state has had either the highest or second highest construction unemployment rate in the nation.

Illinois had the third highest estimated NSA construction unemployment rate in October, the same as in September (based on revised data; previously reported as the fourth highest rate). Still, it was the state’s lowest October construction unemployment rate since the 4.7 percent rate in 2006.

New Jersey fell six spots from its September ranking, when it had a 5.7 percent rate (tied with Montana, Ohio and West Virginia). The state’s 6.5 percent construction unemployment rate was its second lowest October rate after last year’s 6.4 percent rate.

There was only slight movement for Pennsylvania, as it dropped one spot from September’s ranking. Nonetheless, this was the state’s lowest October rate since 2006’s 4.4 percent rate.

Connecticut, which had the fourth highest rate in September (based on revised data, previously reported as the third highest rate), improved to the 14th highest rate in October with a 5.2 percent rate, tied with Delaware and Montana. It was the state’s lowest estimated NSA construction unemployment rate since the 4.7 percent rate in October 2001. It also had the nation’s fourth largest decrease from September, down 1.4 percent.

Meanwhile, Rhode Island, which had the fifth highest rate in September, notched up to sixth highest rate in October—6.2 percent. It was the state’s lowest October construction unemployment rate since the 5.6 percent rate in October 2006.

To better understand the basis for calculating unemployment rates and what they measure, see the article Background on State Construction Unemployment Rates.
Visit ABC Construction Economics for the Construction Backlog Indicator, Construction Confidence Index and state unemployment reports, plus analysis of spending, employment, GDP and the Producer Price Index.

About ABC
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