CONSTRUCTION EMPLOYMENT SHRINKS IN 319 OF THE NATION'S 336 LARGEST METRO AREAS IN JULY, CONTINUING MONTHS-LONG SLIDE

Reno-Sparks, NV & Wenatchee, WA Have Worst Job Losses, Columbus, IN and Weirton-Steubenville, WV-OH Again Have Largest Increases in Construction Employment

ARLINGTON, VA - Construction workers in communities across the country continued to suffer extreme job losses this July according to a new analysis of metropolitan area employment data from the Bureau of Labor Statistics released today by the Associated General Contractors of America. That analysis found construction employment declined in 319 of the nation's largest communities while only 11 areas saw increases and six saw no change in construction employment between July 2008 and July 2009.

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Seasonally adjusted nonfarm payroll employment fell in 29 states in July and rose in 21 states and the District of Columbia, the Bureau of Labor Statistics (BLS) reported on Friday. North Carolina had the largest percentage drop, -0.7%; followed by Mississippi, -0.6%; Nevada and New Mexico, -0.5% each. The largest percentage gains were in D.C., 1.9%; Michigan, 1.0%; New York, 0.7%; South Dakota and Tennessee, 0.6% each. Over the year, nonfarm employment fell in 49 states and rose in North Dakota, 1.0%; and D.C., 0.9%. The biggest over-the-year percentage drops were in Arizona, -7.5%; Michigan, -6.7%, Nevada, -6.4%; and Oregon, -5.7%. Construction employment fell for the month in 34 states plus D.C., rose in 13 and was level (or within 100 of the June figure) in Illinois, Alabama and New Hampshire. Compared to July 2008, construction employment fell everywhere except in Louisiana, 3.6%; North Dakota, 2.8%; and Mississippi, unchanged. The largest 12-month losses were in Arizona, -28%; Nevada, -25%; Connecticut, -22%; and Kentucky, -21%.

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CONSTRUCTION EMPLOYMENT CONTINUES TO SLIDE AS NEW FIGURES SHOW SHRINKING WORK FORCE IN 47 STATES THIS JULY

Arizona and Nevada Lead Nation in Construction Job Losses While Only Louisiana and North Dakota Saw Increases in Construction Employment 

ARLINGTON, VA - Few states were immune from construction employment declines this July based on an analysis of federal employment data released today by the Associated General Contractors of America.  That analysis found that 47 states saw declines in construction employment, while only two states saw increases and one saw no change in construction employment between July 2008 and July 2009.

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The amount of construction work funded by the American Recovery and Reinvestment Act (ARRA, popularly called the stimulus legislation) varies greatly by state and program. Two weeks ago, I spoke on successive days to state transportation officials in Colorado, New Mexico and Maine. They said they had awarded contracts covering 69%, 80% and 100% of their respective DOT allocations. But, of course, those percentages don't necessarily correspond to amounts paid out or even work started. Other states are far behind those three in even holding bid-letting days to pick contractors.

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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.

Nonfarm payroll employment fell in July by 247,000, seasonally adjusted, about half the monthly rate over the 12 months since July 2008, when jobs losses totaled 5,740,000, the Bureau of Labor Statistics (BLS) reported on Friday. In contrast, construction employment fell by 76,000, only slightly less than the 12-month average loss of 88,000 per month. Construction accounted for 30% of the losses in June and 18% of the losses in the 12-month span, although the industry's 6,148,000 jobs in June 2009 accounted for less than 5% of the nonfarm total. The rate of job loss in residential construction (residential building and specialty trade contractors) slowed slightly (to 1.1% in July, vs. 16.4% over 12 months) but nonresidential (building, specialty trades and heavy and civil engineering) construction losses accelerated (1.3% in July, 13.5% over 12 months). In a bad sign for future demand for construction, employment in architectural and engineering services slumped 1.0% for the month and 8.7% over 12 months. The unemployment rate overall was 9.7%, not seasonally adjusted (9.4%, seasonally adjusted), and 18.2% for construction, the highest of any industry. (Industry rates are not reported on a seasonally adjusted basis.) Average hourly earnings in construction rose 4 cents for the month to $22.68, up 3.8% from a year earlier, compared to a 2.5% annual increase for all private production or nonsupervisory workers.

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"Construction employment fell by 76,000 jobs last month, seasonally adjusted," said Stephen Sandherr, chief executive officer of the Associated General Contractors of America, in reference to today's employment numbers released by the Bureau of Labor Statistics.  "Meanwhile, the last 12 months have seen 1,053,000 construction workers lose their jobs, emphasizing the negative impact the current economy is having on the construction industry in particular. Currently, 18.2 percent of construction workers are unemployed, nearly double the 9.7 percent overall unemployment rate, or 9.4 percent seasonally adjusted.  While it is clear that the stimulus has helped prevent even greater job losses, it is apparent that the construction industry is suffering from low demand for commercial facilities, dwindling orders for new office buildings, declining state and local revenue, and the current economic conditions as a whole, including tight credit markets."

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The Federal Reserve provided an unusually detailed - and grim - commentary on conditions in commercial real estate and nonresidential construction in the July 29 "Beige Book," so called for the color of its cover. The Beige Book is issued eight times a year, in advance of meetings of the Federal Open Market Committee, and is a summary of informal soundings of business conditions in the 12 Fed districts, which are referred to by their headquarters cities. AGC members often contribute to those soundings.

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Construction spending in June totaled $966 billion at a seasonally adjusted annual rate (SAAR), 0.3% above the revised May estimate but 10% below the June 2008 level, the Census Bureau reported on Monday. Private residential spending was up 0.5% for the month but down 30% from a year earlier, as new single-family construction increased 2.4% in June but fell 51% year-over-year. New multifamily construction tumbled 7.2% and 33%. Although Census does not separately show residential improvements (additions and major renovations to existing single- and multifamily buildings), an estimate is included in the total. Improvements, now nearly half of the private residential total, rose 1.2% and 6.4%. Total nonresidential spending was up 0.1% from May but down 0.7% from June 2008, as private nonresidential fell 0.5% and 4.8% but public nonresidential rose 0.9% and 5.1%. Public educational construction climbed 0.4% and 4.6%; highways, 0.2% and 2.8%. Among private nonresidential categories, in descending order of size: manufacturing, 0.9% and 46%; power, -2.4% and 15%; commercial (retail, warehouse and farm), -0.6% and -30%; office, 1.0% and -21%; health care, 3.0% and -1.1%; and lodging, -3% and -25%.

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