Construction employment declined by 11,000 jobs in February, with decreases in both residential and nonresidential segments, according to an Associated General Contractors of America (AGC) analysis of government data.
The decline follows stronger hiring in January than previously reported and suggests contractors are becoming more cautious about adding workers amid uncertainty about materials prices and demand for projects, according to AGC.
“Contractors may be more reluctant to add workers amid uncertainty about how much they will pay for construction materials and demand for certain types of construction projects,” says Macrina Wilkins, AGC’s director of market insights. “But even with the monthly drop, construction employment has grown at a faster rate during the past year than the broader economy.”
Construction employment totaled just over 8.3 million jobs, seasonally adjusted, in February – a loss of 11,000 from January. Over the past 12 months, the industry has added 42,000 jobs, a gain of 0.5 percent, outpacing the 0.1 percent increase in total nonfarm payroll employment.
Residential construction lost 7,100 jobs in the month, as a decline of 9,500 positions among residential specialty contractors more than offset a gain of 2,400 jobs among residential building contractors.
Nonresidential construction employment fell by 3,800 jobs in February. Within that category, employment among nonresidential building contractors increased by 4,100 positions. Nonresidential specialty trade contractors lost 1,400 jobs and employment in heavy and civil engineering construction declined by 6,500 jobs for the month.
Average hourly earnings for production and nonsupervisory employees in construction — including most onsite craft workers and many office staff — rose to $38.52 in February, an increase of 5.1 percent over the past year.
Association officials say uncertainty, centered around materials prices and levels of demand for projects, likely prompted some firms to pause hiring in February. They say federal officials could help ease that uncertainty by passing a new surface transportation bill before the current law expires at the end of September. Officials note that AGC has launched a new national campaign, called America’s Moving Forward, to push Congress to pass a new transportation law on time.
“Congress can send a clear signal about construction demand by passing a new highway and transit bill before the current measure expires,” says Jeffrey Shoaf, AGC’s CEO. “As the single largest federal construction measure, the transportation bill is a significant driver of construction demand across the country.”
Related: ABC: Construction Backlog Indicator up in February, contractor confidence grows