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U.S. Construction Adds 11,000 Jobs in July, Nonresidential Still Far Below Pre-Pandemic Levels

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By KERRY SMITH, EDITOR, ST. LOUIS CONSTRUCTION NEWS AND REVIEW MAGAZINE

Construction employment – both nonresidential and residential – totaled 7.42 million as of July 31, an increase of 1.5 percent over June, but the lion’s share of that gain came from hiring in the residential sector.

AGC of America Chief Economist Ken Simonson said soaring materials costs, long or uncertain delivery times and hesitancy by nonresidential project owners to commit to construction are the factors contributing to a still-stalled pace of commercial construction across the U.S.

The numbers hail from an August 6 government data analysis by the AGC.

“Recovery has been especially slow in infrastructure construction,” Simonson said.

Construction employment in July represented a gain of 11,000 jobs following three months of job losses, according to Simonson, however the rebound was limited to residential and specialty trade contractors. Nonresidential building and infrastructure construction firms continued to lose workers.

Residential building contractors including single-family homebuilders added 8,399 employees in July, while employment was unchanged among residential specialty trade contractors. Simonson said the two residential segments have added a total of 58,500 employees, or 2.0 percent, to their workforce nationwide since February 2020.

In contrast, nonresidential building contractors shed 2,500 employees in July. Employment declined by 2,100 among heavy and civil engineering construction firms, the segment most connected with building and rehabbing infrastructure. Nonresidential specialty trade contractors added 7,500 employees last month.

Following the huge loss of jobs between February and April 2020 at the start of the pandemic, infrastructure-centric contractors have added back only 37 percent of lost jobs. According to the AGC analysis, nonresidential building and specialty trade contractors have each regained about 60 percent of lost workers, while the total nonfarm payroll economy has recouped 75 percent of workers.

“There are an unprecedented number of construction material price increases,” said Simonson. “The problems of these extreme price increases and long lead times for production or delivery to project sites mean fewer construction workers are being employed. Some owners are delaying project starts, adding to the drag on industry employment.”

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Construction Employment Stalls in April, Materials Costs Rise Again, Inventories Shrink

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By KERRY SMITH, EDITOR, ST. LOUIS CONSTRUCTION NEWS AND REVIEW MAGAZINE

The level of construction employment remains virtually unchanged in St. Louis and across the U.S. as commercial and residential contractors contend with a prolonged scarcity of able workers and a still-choked building materials supply chain.

Associated General Contractors of America Chief Economist Ken Simonson says finding enough workers continues to be a feat, as reflected in workforce statistics from April. Augmenting the people shortage, he adds, are problems in getting stable prices and reliable deliveries of key materials.

“Contractors are experiencing unprecedented intensity and range of cost increases, supply-chain disruptions and worker shortages that have kept firms from increase their workforces,” said Simonson. “These challenges will make it difficult for contractors to rebound as the pandemic appears to wane.”

Construction employment in the U.S. during April totaled 7.45 million, matching March’s level but 2.6 percent below the most recent peak in February 2020. Simonson said the number of former construction workers (768,000) who were unemployed in April dropped by half from one year ago, and the sector’s unemployment rate fell from 16.6 percent in April 2020 to 7.7 percent last month.

“The fact that (construction) employment has stalled – despite strong demand for new homes, remodeling of all types and selected categories of nonresidential categories – suggests that contractors can’t get either the materials or the workers they need,” Simonson said, noting that many firms are reporting backlogs and rations of key materials.

Still in short supply, according to the Institute for Supply Management’s latest survey report, are steel and steel products (for five months now), PVC products (a three-month shortage), lumber and circuit breakers.

Price spikes continue relative to copper, wire, oriented strand board, lumber, wood products, resin products, PVC products, steel, diesel, aluminum, vinyl windows and roof shingles.

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