Real (net of inflation) gross domestic product increased 2.0% in the third quarter of 2010 at a seasonally adjusted annual rate, up from 1.7% in the second quarter, according to the advance estimate today by the Bureau of Economic Analysis. Real investment in private nonresidential structures rose 3.9% after falling for eight straight quarters. Real residential investment slumped 29%, after rising 26% in the second quarter, reflecting the end of the homebuyer tax credit in April. Real government investment in structures rose 8.8%, following a 9.0% second-quarter gain, boosted by federal spending on stimulus projects, military base realignment and Gulf Coast hurricane recovery and preparation. The price indexes for the three types of investment rose at seasonally adjusted annual rates of 2.6% for private nonresidential, -0.5% for residential, and 1.9% for government structures.

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CONSTRUCTION EMPLOYMENT DECLINES IN 236 OUT OF 337 METROPOLITAN AREAS BETWEEN SEPTEMBER 2009 & 2010 

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

Construction employment declined in 236 out of 337 metropolitan areas between September 2009 and September 2010 according to a new analysis of federal employment data released today by the Associated General Contractors of America.  Meanwhile, the number of metro areas adding jobs - 56 - matched the previous month's data, indicating the sector remains weak more than a year after the official end of the recession, association officials noted.

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Seasonally adjusted nonfarm payroll employment rose in 16 states and the District of Columbia and declined in 34 states between August and September, the Bureau of Labor Statistics (BLS) reported on Friday. Over the past 12 months, employment increased in 32 states plus D.C. and dropped in 18 states. The unemployment rate fell in September in 23 states plus D.C., climbed in 11 states and was unchanged in 16. Over the year, the rate improved in 29 states plus D.C., worsened in 16 states and remained steady in five. AGC's analysis of the data showed that construction employment increased for the month in 15 states plus D.C., shrank in 31 states and held level in Colorado, Idaho, New Mexico and Vermont. Over the year, construction employment rose in nine states plus D.C., slipped in 40 states and was unchanged in Alaska. The largest 12-month percentage gains in construction employment were in Oklahoma (10%, 6,500 jobs), Kansas (9%, 5,000 jobs) and New Hampshire (8%, 1,800 jobs). The steepest losses were in Nevada (19%, 14,200 jobs), Vermont (14%, 1,900 jobs) and Idaho (12%, 4,000 jobs). BLS does not compute state unemployment rates by industry. Data for D.C. and six states includes logging and mining with construction to avoid disclosure about industries with few firms.

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CONSTRUCTION EMPLOYMENT DECLINES IN 31 STATES BETWEEN AUGUST AND SEPTEMBER AS INDUSTRY CONTINUES TO SUFFER

Minnesota and Hawaii Add Most Construction Jobs, While California and Rhode Island Lose the Most Construction Jobs During the Past Month; Only Ten States Added Construction Jobs During the Year

Construction employment declined in 31 states between August and September, while fewer people are working in construction compared to last year in 40 states, the Associated General Contractors of America reported in an analysis of state employment data released today by the Labor Department.  Construction employment is likely to continue to worsen amid uncertainty about federal spending and tax rates for next year, association officials noted.

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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.

The producer price index (PPI) for finished goods increased 0.3%, not seasonally adjusted (0.4%, seasonally adjusted), in September and 4.0% over the past 12 months, the Bureau of Labor Statistics (BLS) reported on Thursday. The PPI for inputs to construction, a weighted average of materials used in every type of project plus items consumed by contractors (such as diesel fuel), fell 0.1% for the month but increased 3.8% over 12 months. The year-over-year rise adds to an ongoing squeeze on contractors, as PPIs for finished nonresidential buildings and subcontractors' work, which include overhead and profit, have fallen or have risen less than materials costs. The PPI for new office construction fell 0.2% in September and 0.4% year-over year; warehouses, 0 and -0.3%; industrial buildings, 0 and +0.4%; and schools, -0.1% and 1.0%. For new and repair work on nonresidential buildings, the PPI for roofing contractors was flat for the month and sloped down 2.7% over 12 months; concrete contractors, 0.4% and +0.1%; electrical, -0.2% and +0.1%; and plumbing, 0 and +2.8%. Materials with year-over-year increases included diesel fuel, -1.5% for the month but up 18% from September 2009; steel mill products, 1.2% and 14%; aluminum mill shapes, 2.0% and 7.9%; lumber and plywood, -1.3% and 6.5%; copper and brass mill shapes, 5.1% and 5.9%; and asphalt paving mixtures and blocks, -0.3% and 5.1%. PPIs fell for gypsum products, -2.6% and -2.3%; and concrete products, 0 and -0.8%.

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Construction employment fell by 21,000 (0.4%), seasonally adjusted, in September to 5,604,000, the Bureau of Labor Statistics (BLS) reported on Friday. The industry has added only 19,000 jobs on net since reaching a low in February, whereas the overall private sector has added jobs for nine straight months. Over the past 12 months, the industry has shed 210,000 employees (3.6%). Among the five BLS categories of construction, one only has added jobs in the last year: 8,500 (1.0%) in heavy and civil engineering construction, the segment most helped by stimulus, military base realignment and New Orleans flood-prevention funding. Employment fell in residential building (37,200, 6.1%), nonresidential specialty trade contractors (108,400, 5.1%), residential specialty trade contractors (55,500, 3.5%), and nonresidential building (17,000, 2.4%). Architectural and engineering services employment, a harbinger of future demand for construction, was roughly level for the month and down 1.6% year-over-year. Architectural services employment, closely associated with building construction, fell 6.2% from a year ago (not seasonally adjusted), whereas engineering and drafting services employment, more connected to public works and power construction, was off 0.6% (unadjusted). Average hourly earnings of all employees in construction fell 1 cent, seasonally adjusted, in September to $25.22, just 28 cents (1.1%) higher than in September 2009. For the entire private sector, earnings rose 1.7% over the year to $22.67.

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CONSTRUCTION EMPLOYMENT NEAR 14-YEAR LOW AS 21,000 INDUSTRY JOBS LOST IN SEPTEMBER, UNEMPLOYMENT RATE CLIMBS TO 17.2 PERCENT

Construction Industry Unemployment At Highest September Rate Ever Recorded as Sector Suffers from Private, State and Local Funding Declines and Unclear Federal Funding Plans  

The number of people working in construction is approaching a 14-year low now that the industry lost 21,000 jobs in September, while construction unemployment is at a September high of 17.2 percent, according to an analysis of federal employment figures released today by the Associated General Contractors of America.  The construction industry continues to suffer from declining investments in construction and broad uncertainty about the future of many federal infrastructure programs and tax rates, association officials noted.

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Construction spending edged up 0.4% in August to $812 billion at a seasonally adjusted annual rate but remained 10% below the August 2009 level, the Census Bureau reported today. The good news was limited to public construction, which climbed 2.5% for the month, although it was down 1.0% year-over-year. Based on categories with increases, the public uptick appeared to result from federal funds for stimulus, military base realignment, and hurricane reconstruction and prevention, although Census does not list individual projects or sources of funds. Stimulus funds appear to have lifted public housing (up 33% from August 2009 to August 2010), sewage and waste disposal (up 19%), water supply construction (up 5.2%) and highway and street construction (up 0.9%). Reconstruction work around New Orleans may have helped conservation spending rise 18%. In contrast, public educational construction, which is almost entirely funded from state and local revenues, slumped 13%. Private nonresidential spending fell 1.4% for the month and 24% year-over-year, with all 11 categories in the Census press release declining from a year earlier, most by double-digit percentages. Private residential spending slipped 0.3% for the month and 1.7% since August 2009. New single-family construction fell 4.2% in August, the fourth straight drop since the homebuyer tax credits expired in April, though spending was 3.9% higher than in August 2009. New multi-family construction slumped 11% for the month and 52% year-over-year. Improvements to existing single- and multi-family rose 5.0% and 4.2%, respectively.

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STIMULUS, BASE REALIGNMENT, OTHER FEDERAL PROGRAMS DRIVE TOTAL CONSTRUCTION SPENDING UP 0.4 PERCENT TO $812 BILLION IN AUGUST

Private Construction Spending Continues "Devastating" Decline, Construction Association Officials Note, Urging Action on Long-Term Infrastructure Bills to Avoid Another Downturn for Hard-Hit Industry

Total construction spending edged up 0.4 percent between July and August to $812 billion, driven by increases in public construction activity including stimulus and base realignment projects, according to an analysis of new Census Bureau data released today by the Associated General Contractors of America.  Association officials cautioned, however, that private residential and nonresidential spending both continued to shrink as private-sector demand for construction remains extremely weak.

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