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Industry Unemployment Drops to Lowest Level in Series History

Construction firms added employees over the past year at nearly double the rate of the overall economy.

Fri July 07, 2017 - National Edition
Construction Equipment Guide

Construction employment increased by 16,000 jobs in June to the highest level since October 2008, signaling a new burst of hiring after three months of pause, according to an analysis of new government data by the Associated General Contractors of America. Association officials urged federal, state and local lawmakers to enact measures to make it easier for school officials, local associations and construction firms to set up construction training programs.

"Construction firms added employees over the past year at nearly double the rate of the overall economy, but the record-low unemployment rate for construction workers shows companies are having to reach outside the industry to fill positions," said Ken Simonson, the association's chief economist. "Finding any qualified workers will likely become even harder with low unemployment throughout the economy."

Construction employment totaled 6,896,000 in June, a gain for the month of 16,000—nearly double the 9,000 jobs added in the previous three months combined, the economist noted. The June level constituted an increase of 206,000, or 3.1 percent, from a year ago. The year-over-year growth rate was almost double the 1.6 percent rise in total nonfarm payroll employment. The sector's unemployment rate in June virtually matched the rate for all workers at 4.5 percent, the lowest June level for construction since the series began in 2000.

Average hourly earnings in the industry climbed to $28.82, an increase of 2.5 percent from a year earlier. The economist noted that construction pays nearly 10 percent more per hour than the average nonfarm private sector job in the United States, which pays $26.25 on average per hour.

Residential construction—comprising residential building and specialty trade contractors—added 6,000 jobs in June and 115,600, or 4.5 percent, over the past 12 months. Nonresidential construction (building, specialty trades, and heavy and civil engineering construction) employment increased by 10,300 jobs in June and 90,600, or 2.2 percent, over 12 months.

Construction officials cautioned that construction employment gains would likely have been higher if it were easier for firms to find workers to hire. Instead, firms are asking current employees to work longer hours to keep pace with demand. They urged lawmakers at all levels to enact measures that give educators and employers greater flexibility to set up and run construction training programs. In particular, they called on Senators to enact a new Perkins Act measure that passed in the House last month.

"More young people would be able to find jobs in construction that pay better than other industries if there were more opportunities to expose students to the sector," said Stephen E. Sandherr, the association's chief executive officer. "It is time to fix an education system that is preparing too many students for jobs that don't exist while too many jobs go unfilled because graduates lack the skills employers need."

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