Washington, Jan. 31—The not seasonally adjusted (NSA) national construction unemployment rate was 5.9 percent in December, down 1.5 percent from December 2016 and the lowest December rate on record, according to an analysis released today by Associated Builders and Contractors (ABC) of U.S. Bureau of Labor Statistics (BLS) data. Estimated construction unemployment rates were down in 46 states on a year-over-year basis, unchanged in one (Idaho) and up in three states (Connecticut, Massachusetts and New Hampshire).
At the same time, the construction industry employed 250,000 more workers than in December 2016.
“Healthy construction activity throughout much of the country is supporting strong construction employment,” said Bernard M. Markstein, Ph.D., president and chief economist of Markstein Advisors, who conducted the analysis for ABC. “The recovery and rebuilding efforts following 2017’s hurricanes, floods and wildfires continue to increase demand for workers, offsetting some of the usual seasonal reductions in construction employment. Many workers in cold-weather states who have experienced normal reduced demand for their services have moved to states where building and rebuilding continues.”
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 some information, although extra care must be used in drawing conclusions from these movements.
From the beginning of the data series in 2000 through 2016, the monthly change in the national NSA construction unemployment rate from November to December has always been an increase. The rate for December 2017 was no different, increasing 0.9 percent from November, well below the median increase of 1.9 percent. Among the states, 46 had increases and four had decreases (Alaska, Montana, Nevada and Oregon).
The Top Five States
The states with the lowest estimated December NSA construction unemployment rates in order from lowest to highest were:
1. Hawaii, 2.9 percent
2. Colorado, 3.8 percent
3. Massachusetts, 3.9 percent
4. Virginia, 4 percent
5. Georgia, South Carolina and Texas (tie), 4.2 percent
Three of the top five states were in the top five in November: Colorado, Hawaii and Massachusetts.
Hawaii continued its number-one ranking for the third month in a row. It was the state’s second lowest December rate since the beginning of the estimates in 2000, behind December 2006’s 2.3 percent rate. 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.
Colorado had the second lowest December rate. That was an improvement from third lowest in November, tied with Idaho and Massachusetts, based on revised data (previously reported as the fifth lowest rate). This was Colorado’s lowest December estimated rate since the 3.4 percent rate in December 2000, which also makes it the state’s second lowest rate on record.
Massachusetts had the third lowest December construction unemployment rate, the same ranking as in November based on revised data (previously reported as the fourth lowest rate). It was the state’s second lowest December rate after 2016’s 3.6 percent rate.
Virginia had the fourth lowest rate in December, up from being tied with Texas for eighth lowest in November. It was the state’s lowest estimated December rate since 2006’s 3.4 percent and its third lowest December rate on record.
Georgia, South Carolina and Texas tied for the fifth lowest rate in December. For Georgia, that was up from 12th lowest in November (tied with Iowa and Kansas). It was the state’s lowest estimated December rate on record.
For South Carolina, it was also the state’s lowest estimated December rate on record and an improvement in ranking from 10th lowest rate in November.
For Texas, it was an improvement from being tied with Virginia for eighth lowest rate in November. It was also the state’s lowest December rate on record, matching 2006’s 4.2 percent rate.
Utah, which had the second lowest rate in November, dropped to the 11th lowest rate (tied with Oregon) with a 4.6 estimated construction unemployment rate. Nonetheless, it was the state’s lowest December unemployment rate since the 3 percent rate in 2007.
Idaho, which tied with Colorado and Massachusetts for the third lowest rate in November based on revised data (previously reported as tied with Utah for the second lowest rate), fell to eighth lowest in December with a 4.3 rate. That rate matched 2016’s rate, which is also the lowest December rate on record for the state.
The Bottom Five States
The states with the highest November NSA construction unemployment rates in order from lowest to highest were:
46. New Mexico and Rhode Island (tie), 9.3 percent
47. Montana, 9.5 percent
48. West Virginia, 9.8 percent
49. Illinois, 10.2 percent
50. Alaska, 15.2 percent
Four of these states—Alaska, Illinois, Montana and New Mexico—were also among the bottom five states in November.
Alaska had the highest rate in the nation for the fifth consecutive month. Given that these estimates are not seasonally adjusted, a high construction unemployment rate for the state at this time of the year is normal. However, this was the state’s lowest December rate since the 13.9 percent rate in December 2001. Alaska was also one of the four states that posted a decrease in their rate from November, down 0.7 percent, behind Montana’s 0.8 percent decrease.
Illinois had the second highest rate in December, compared to the fourth highest in November. This was the state’s lowest December construction unemployment rate since its 9.5 percent rate in December 2006.
West Virginia had the third highest estimated NSA construction unemployment rate in December, compared to the sixth highest in November.
Montana had the fourth highest construction unemployment rate in December, an improvement from second highest in November. Further, the state had the largest monthly decline and tied with Alabama for the largest year-over-year decrease in the nation—down 0.8 percent and 4.3 percent, respectively. It was also the state’s lowest December rate since the 7.1 percent in December 2007.
New Mexico and Rhode Island tied for the fifth highest rate in December. For New Mexico, it was an improvement in its ranking from third highest in November but a steep slide in Rhode Island’s ranking, which had the 15th highest rate in November.
Rhode Island also had the dubious distinction of tying with Iowa for the second largest monthly increase in its rate, up 3.5 percent, behind South Dakota’s jump of 3.9 percent. In spite of this, it was the state’s lowest estimated December NSA construction unemployment rate since its 8.3 rate in December 2006.
Connecticut, which had the fifth highest rate in November, improved in ranking to the 10th highest rate in December with an 8.8 percent rate. Although it was one of only three states with a year-over-year increase in its rate, it was the state’s second lowest December rate after 2016’s 8.2 percent since 2006’s 8.5 percent rate.
To better understand the basis for calculating unemployment rates and what they measure, go to abc.org/economics and read 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.
Associated Builders and Contractors (ABC) is a national construction industry trade association established in 1950 that represents more than 21,000 members. Founded on the merit shop philosophy, ABC and its 70 chapters help members develop people, win work and deliver that work safely, ethically and profitably for the betterment of the communities in which ABC and its members work. Visit us at abc.org.