Construction employment declines by 15,000 jobs in March
- Construction industry employment decreased by 15,000 jobs in March, putting a small dent in February's impressive gain of 65,000 positions, upwardly revised from 61,000, the U.S. Bureau of Labor Statistics reported Friday. Since March 2017, the construction sector has added 228,000 new jobs.
- The nonresidential sector lost 8,200 jobs in March — nonresidential building (+2,200), heavy and civil engineering construction (-3,600) and nonresidential specialty trade contractors (-6,800).
- The loss of jobs, said Anirban Basu, chief economist for the Associated Builders and Contractors, could be a result of the uncertainty surrounding the Trump administration's new trade policies and escalating trade tensions with China. This has stymied the progress, he said, that the construction industry should be seeing after passage of the tax reform package last year. Basu added that the construction industry is more sensitive to policies and events that affect confidence because construction projects involve the risk of financing and long lead times to completion.
The impact of the Trump administration's 25% steel tariff and 10% aluminum tariff is already revealing itself among U.S. construction companies, some of which are reporting material price increases of 10%. Material prices were already on the rise prior to the tariffs. With the added burden of higher prices for material sourced from abroad, industry groups have warned that projects could die under the weight of heavier budgets and those already in progress could very well suffer budget overruns.
The tariffs have also unexpectedly hurt some steel fabricators in the U.S., even though the Trump administration said one of the goals of the new tariffs was to protect American businesses. The steel tariff is on raw steel, which some domestic fabricators buy from foreign countries. This has increased the price of their end products, and some have lost business to fabricators in other countries that can do the job cheaper.
According to the Associated General Contractors of America, March employment indicators still point to strong industry performance, but also indicate the sector needs to beef up the worker pipeline through career and technical education programs. The industry's 7.4% unemployment rate, according to the AGC, was the lowest March figure on record and, despite March weather hindering construction activity, pay rates and growth are outperforming other U.S. industries.
- Bureau of Labor Statistics THE EMPLOYMENT SITUATION — MARCH 2018
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