Dive Brief:
- The rate of open construction jobs dropped to its lowest point in nearly a decade, according to a Tuesday Bureau of Labor Statistics report, indicating contractors have decreased interest in hiring new positions in the near future.
- Construction counted 188,000 open jobs on the last day of the month, a drop of about 38% both month-to-month and year over year. In August, 2.2% of all construction jobs went unfilled, the lowest in almost ten years and a major dip from 3.5% the month prior.
- Combined with relatively low layoffs and discharges and spending decreases, economists suggest the job openings report indicates the industry is contracting, though the effects may be confined to the short term.
Dive Insight:
The 115,000 drop in open jobs may seem like whiplash among continued reports that construction suffers from a dire need for workers, but the industry faces multiple headwinds that can cause workers to be furloughed.
“While this data series tends to be volatile on a month-to-month basis, the precipitous decline in job openings aligns with other indicators like construction spending and employment, both of which have fallen in recent months,” said Anirban Basu, chief economist for Associated Builders and Contractors, in a release.
Additionally, the BLS does not differentiate between commercial and residential construction.
“This mix of signals highlights a labor market that remains tight but is cooling in some respects. Contractors are still bringing on workers at a steady pace, and quits are slightly higher than a year ago, suggesting some mobility among workers,” Macrina Wilkins, senior research analyst for the Associated General Contractors of America, told Construction Dive in an email.
The number of quits in August increased by 19,000, or 15%, year over year, as the rate of quits rose to 1.8% from 1.5%.
“At the same time, fewer new job postings point to a slowdown in demand, while layoffs are only modestly higher,” Wilkins said. “Together, these figures show an industry still competing for skilled labor but with signs of easing pressure compared to last year.”
Construction’s rough month sticks out against the broader employment data landscape. The number and rate of job openings across all industries remained unchanged in August, the BLS said, and the report called out construction as the first industry with a major decrease in available positions.
The government shutdown may create a murky understanding of jobs data. The Department of Labor’s contingency plan, released Sept. 26, said it would cease operations for the BLS, which is set to release the jobs report Friday. The report has likely already been finalized, the New York Times reported, but now it may be a while before contractors and economists have a full understanding of the employment situation in the U.S.
