AGC released analyses in the past week of construction job changes from August 2009 to August 2010 in every state and in 337 metropolitan areas. Although only one-fifth of the states (nine, plus the District of Columbia) and one-sixth of the metro areas (56) had year-over-year job increases, these were the highest totals since the fall of 2008.

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56 OUT OF 337 METRO AREAS ADD CONSTRUCTION JOBS BETWEEN AUGUST 2009 & 2010, HIGHEST NUMBER ADDING JOBS SINCE SEPTEMBER 2008

Hanford-Corcoran, California and Kansas City, Kansas Top List of Metro Areas Adding Jobs while Chicago and Napa, California Lose Most Jobs for the Year

Construction employment expanded in 56 out of 337 metropolitan areas between August 2009 and August 2010 according to a new analysis of federal employment data released today by the Associated General Contractors of America.  More cities added construction jobs during the past year than at any point since September 2008, indicating that the worst of the industry's job losses may be over, association officials noted.

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Seasonally adjusted construction employment rose in August in 25 states and the District of Columbia, dropped in 23 states and remained level in Iowa and Texas, AGC reported on Tuesday, based on new Bureau of Labor Statistics data. Compared with August 2009, construction employment rose in nine states plus D.C., the largest number of locations with a year-to-year gain since October 2008. Construction employment decreased over the 12-month span in 41 states. The largest 12-month percentage increases were in New Hampshire, 10%, 700 jobs; Oklahoma, 9%, 6,300 jobs; Kansas, 8%, 4,600 jobs; and D.C., 4%, 400 jobs. The worst percentage declines were in Nevada, 20%, 14,700 jobs; Vermont, 14%, 1,900 jobs; Idaho, 13%, 4,300 jobs; Colorado, 12%, 15,300 jobs; and Washington, 11%, 17,600 jobs. (Logging and mining are combined with construction data for D.C. and six states to prevent disclosure about industries with few employers.)

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TWENTY-FIVE STATES AND THE DISTRICT OF COLUMBIA ADD JOBS IN AUGUST, WHILE 10 ADD JOBS IN THE LAST YEAR

Illinois adds most jobs in August, while Minnesota loses most jobs monthly and New Mexico has largest monthly percent decline

Construction jobs were added in half the states in August, while the number of states with year-over-year job gains rose to 10 from just six in July, the Associated General Contractors reported in an analysis of state employment data released today by the Labor Department. The number of states that increased construction employment over 12 months was the largest since October 2008.

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The producer price index (PPI) for finished goods fell 0.1% in August, not seasonally adjusted (but rose 0.4%, seasonally adjusted) and 3.1% over 12 months, the Bureau of Labor Statistics (BLS) reported on Thursday. The PPI for construction inputs rose 0.2%, not seasonally adjusted for the month and 3.6% over 12 months. PPIs for finished buildings were nearly flat over 12 months; thus, contractors were paying more for materials but not passing the cost along. Specifically, the PPI for new school construction fell 0.2% in August but rose 0.9% for the year; industrial building construction, 0 and 0.2%; offices, 0 and -0.5%; and warehouses, -0.1% and -0.6%. Only two materials had large increases for the month: copper and brass mill shapes, 6.5% and 5.0% year-over-year, and diesel fuel, 5.8% and 13%. The PPI for steel mill products fell 3.9% in August but rose 17% over 12 months; asphalt paving mixtures and blocks, -0.6% and 7.9%.

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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.

"Reports from the 12 Federal Reserve Districts suggested continued growth in national economic activity during the reporting period of mid-July through the end of August, but with widespread signs of a deceleration compared with preceding periods," the Fed reported on Wednesday in the latest Beige Book, a summary of informal surveys of firms in each district (identified by its headquarters city). "Recent weakness [in manufacturing] was most notable for construction-related products, according to reports from Cleveland, Richmond, Chicago, Dallas, and San Francisco….Residential construction activity declined in most areas in response to weak demand. Cleveland, St. Louis, and Minneapolis were the exceptions to this pattern of declining activity, with reports from their contacts indicating that residential construction activity improved of late. Inventories of available homes rose in general, although the availability of new homes in Atlanta was held down by the slow pace of new home construction….Demand for commercial, industrial, and retail space generally remained depressed. Vacancy rates stayed at elevated levels in general and rose further in a few Districts, placing substantial downward pressure on rents. Asking rents continued to decline in parts of the New York and Kansas City Districts. High vacancies and negative absorption held nonresidential construction activity to the bare minimum in most Districts. A few Districts reported exceptions to weak conditions. Cleveland noted improved construction activity for industrial use and educational infrastructure; this raised overall activity above year-earlier levels and prompted modest hiring by builders. Chicago reported an increase in inquiries for commercial redevelopment and rising construction activity for public projects, but Richmond reported that state and local governments cut back on construction projects."

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View AGC Chief Economist Ken Simonson's presentation on the outlook for construction activity, materials and labor.

Nonfarm payroll employment in August fell by 54,000, seasonally adjusted, as layoffs of temporary Census workers swamped an increase of 67,000 in private-sector payrolls, the Bureau of Labor Statistics (BLS) reported today. The unemployment rate in August was 9.6% (9.5%, not seasonally adjusted), up slightly from 9.5% in July. "In construction, employment was up by 19,000 in August; however, about half of the increase was due to the return of 10,000 workers to their jobs following a strike in July," BLS Commissioner Keith Hall said in a statement. "On net, construction employment is about unchanged since March." The construction unemployment rate in August was 17.0%, not seasonally adjusted, the highest August rate since BLS began calculating industry rates in 1976 and up from 16.5% a year before. (Unadjusted rates for industries with large seasonal swings, such as construction, should be compared only to the same month in past years, not across months. BLS does not disseminate seasonally adjusted industry rates.) Over the past year, seasonally adjusted construction employment declined by 274,000 (4.7%) with decreases in all five BLS categories: nonresidential specialty trade contractors, 123,700 (5.8%); residential specialty trade contractors, 63,200 (4.0%); residential building, 45,700 (7.4%); nonresidential building, 31,900 (4.5%); and heavy and civil engineering construction, 10,000 (1.2%). Architectural and engineering services employment, a harbinger of future demand for construction, was flat for the month and down 24,400 (1.9%) over 12 months. Average hourly earnings for all workers in construction rose 3 cents to $25.20 in August, seasonally adjusted, and 28 cents (1.1%) from August 2009.

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CONSTRUCTION ADDED 19,000 JOBS LAST MONTH AS STRIKE ENDS  BUT INDUSTRY'S 17 PERCENT UNEMPLOYMENT RATE IS HIGHEST EVER FOR AUGUST

Industry Association Urges Congress and the Administration to Act on Long-Delayed Infrastructure Bills and Avoid Tax Rate Increases or Risk Further Job Losses 

The construction industry added 19,000 jobs in August as a strike that had lowered employment in July ended, but the sector's 17 percent unemployment rate was the highest August rate ever, according to a new analysis by the Associated General Contractors of America of federal employment data released today.  Continuing gridlock in Washington over infrastructure legislation and expiring tax rates threatens to keep construction workers unemployed much longer, association officials warned. 

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