The unemployment rate climbed in every state in December, compared to the month before and to December 2007, the Bureau of Labor Statistics reported on January 27. The unemployment rate in construction soared to 15.3 percent, not seasonally adjusted.  Nationally, construction lost 632,000 jobs last year, the largest absolute loss in 33 years and the largest percentage decline (8.5 percent) since 1991. That total accounted for nearly a quarter of all payroll job losses throughout the economy.  From the record set in September 2006, construction has shed 899,000 jobs, seasonally adjusted, or nearly 12 percent of the peak figure—the largest percentage decline of any sector.

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Stimulus legislation expected to be considered by the U.S. House of Representatives on Wednesday includes approximately $149 billion of funding to be obligated by September 30, 2009, for infrastructure and public building investment provisions, according to a tabulation by AGC. Transportation infrastructure ($44 billion) includes $30 billion for highway and bridge construction, $9 billion for transit and $3 billion for airport improvement grants. Water and environmental infrastructure ($17 billion) includes $6 billion for the Clean Water State Revolving Fund (SRF), $4.5 billion for the Corps of Engineers and $2 billion for the Drinking Water SRF. Building infrastructure ($55 billion) includes $14 billion for K-12 school construction, $6 billion for higher education facilities, $6.7 billion for General Services Administration federal buildings and facilities, $5 billion for a public housing capital fund, $4.2 billion for Department of Defense (DOD) medical facilities, $2.1 billion for DOD facilities renovations, $3.1 billion for construction on public lands and parks, and 22 other categories. Energy and technology ($28 billion) includes $11 billion for the electricity grid, $6.9 billion for local government energy efficiency block grants, $6 billion for wireless and broadband grants, and $2.5 billion for energy efficiency housing retrofits. There are also numerous tax provisions that would encourage construction activity (through faster write-offs, tax credits or favorable bond provisions) or assist construction firms (through extending loss carrybacks from two to five years, repealing the 3% withholding on government contracts currently slated to begin in 2011, and faster write-offs on equipment). A Senate bill is expected to be marked up on Tuesday; leaders in both houses hope to pass an identical bill and have it ready for President Obama's signature by mid-February.

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View AGC Chief Economist Ken Simonson's January 25 presentation on Construction & Materials Outlook.

AGC has compiled tables of PPIs for construction materials and segments as well as analysis. The data is from the Bureau of Labor Statistics monthly report and covers over 50 construction specific data series.

Construction was on the bleeding edge of job losses last year. The Bureau of Labor Statistics reported on Friday that construction accounted for nearly one-quarter of the 2.6 million jobs lost throughout the economy in 2008, even though the industry employs only one out of 20 nonfarm workers.

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Nonfarm payroll employment skidded 524,000, seasonally adjusted, in December and 2.6 million (-1.9%) over 2008 as a whole, the Bureau of Labor Statistics (BLS) reported on Friday. Construction accounted for 101,000 lost jobs (almost one-fifth of the monthly total) in December and 632,000 (-8.5%) for the year (nearly one-fourth of the annual loss), although the industry makes up only 5% of total payroll employment (6.8 million out of 135.5 million in December). Losses occurred in all five BLS construction job categories: residential building, -16% for the year; residential specialty trade contractors, -11%; nonresidential building, -7%; nonresidential trades, -5%; and heavy and civil engineering, -9%. Architectural and engineering services, a harbinger of future construction demand, fell 1.4% for the year. Average hourly earnings of production and nonsupervisory workers rose 66 cents (3.7%) for the private nonfarm sector and $1.07 (5.1%) in construction, to $22.37, seasonally adjusted, in December. The unemployment rate over the year rose from 4.8% to 7.1%, not seasonally adjusted (from 4.9% to 7.2%, seasonally adjusted) for all worker and from 9.4% to 15.3% for construction workers.

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AGC developed and released a Construction Employment and Business Forecast January 8 based on a survey of AGC members conducted in late 2008.  According to the results of the survey, an estimated two-thirds of the nation’s non-residential construction companies are planning to cut their payrolls in 2009.  AGC conducted a media conference call to release the data, and it has been quoted widely in publications across the nation.  View the release and survey results here.

Construction spending in November totaled $1.078trillion at a seasonally adjusted annual rate, down 0.6% from October and 3.3% from November 2007, the Census Bureau reported on Monday. The October and September totals were revised up by a combined $16 billion, and the average of the past three months now shows an increase from June-August, despite the deterioration in credit and broader economic conditions since early September. The decrease was concentrated in private residential spending, which tumbled 4.2% for the month and 23% compared to November 2007. Private nonresidential spending rose 0.7% and 10%; public spending climbed 1.4% and 7.9%. Among the largest nonresidential categories, educational construction rose 0.6% and 5.5%; highways and streets, 1.3% and 7.7%; manufacturing, 3.4% and 61%; office, 1.1% and 10%; and power, 5.3% and 27%. Commercial (retail, warehouse and farm) fell, -1.3% and-13%.

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