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AGC's Data DIGest: March 17-21, 2014

Most states, metros added jobs in latest year; MHC, Reed, ABI differ on activity levels

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Seasonally adjusted construction employment increased in 38 states between January 2013 and January 2014, decreased in nine states and the District of Columbia, and remained level in Maine, New Mexico and Rhode Island, an AGC analysis of Bureau of Labor Statistics (BLS) data released last week showed. The largest percentage gains were in Kansas (10.7%, 5,900 jobs); Oregon (9.4%, 6,600); Florida (9.2%, 32,700); Minnesota (9.2%, 8,900) and Alaska (9.1%, 1,500). Florida added the most jobs, followed by California (27,300, 4.4%) and Texas (26,000, 4.3%). The largest annual percentage losses occurred in Wyoming (-5.9%, -1,300 jobs) and West Virginia (-5.4%, -1,900). Indiana lost the most jobs (-3,700 jobs, -3.0%), followed by West Virginia, Wyoming and New Jersey (-1,300 jobs, -1.0%). For the month, 27 states added construction jobs, 21 states and D.C. lost jobs, and employment was unchanged in Connecticut and North Dakota. Idaho added the highest percentage of new construction jobs between December and January (5.8%, 1,900 jobs), and Ohio added the most jobs (8,000, 4.3%). Vermont experienced the largest percentage decline for the month (-5.5%, -800 jobs). California shed the most construction jobs (-6,600, -1.0%). (BLS made routine annual revisions in monthly totals going back to 1990. The agency combines mining and logging with construction in D.C. and six states to avoid disclosing data for industries with few firms.)

From January 2013 to January 2014 construction employment increased in 195 out of 339 metropolitan areas (including divisions of larger metros) for which BLS reports construction data, declined in 90 and was flat in 54, according to an analysis of BLS data that AGC released on Thursday. (Because metro data is not seasonally adjusted, comparisons with months other than January are not meaningful.) The Los Angeles-Long Beach-Glendale division added the most jobs in the past year (8,100 construction jobs, 7%), followed by Houston-Sugar Land-Baytown (7,900 construction jobs, 4%) and the Santa Ana-Anaheim-Irvine, Calif. division (7,800 jobs, 11%). The largest percentage gains occurred in Pascagoula, Miss. (46%, 2,100 combined jobs), El Centro, Calif. (39%, 700 combined jobs) and Steubenville-Weirton, Ohio-W.Va. (38%, 600 combined jobs). The Gary, Ind. division had the highest number and percentage of jobs lost (-4,400 construction jobs, -25%).

New construction starts in February were essentially the same as January’s amount,” at a seasonally adjusted annual rate, McGraw Hill Construction (MHC) reported on Thursday, based on data it collected. “The flat pace for total construction starts in February was due to a mixed performance by major sector—less nonresidential building [-9% for the month], but more housing [3%] and public works [8%]. For the first two months of 2014, total construction starts on an unadjusted basis were…down 3% from the same period a year ago.”

The value of nonresidential construction starts dropped 3.2%, not seasonally adjusted, from February 2013 to February 2014, Reed Construction Data reported last Tuesday, based on data it collected. Year-to-date data for the first two months of 2014 were down 5.0% from the same months of 2013. Nonresidential building construction starts slumped 14% year-to-date, with drops in commercial (-16%) and institutional (-3.1%) building starts. Heavy engineering starts rose 12%.

For the second straight month, the number of architecture firms reporting that billings rose in February edged out the number reporting decreases, the American Institute of Architectures stated on Wednesday in its latest Architecture Billings Index (ABI). The ABI, a harbinger of construction spending 9-12 months later, hit 50.7 in February and 50.4 in January, following two months just below the breakeven level of 50. Practice specialty sub-indexes (calculated as three-month averages) varied: residential (mainly multifamily), 52.5, up from 51.8 in January; commercial/industrial, 51.9, up from 50.9; institutional, 49.6, still below breakeven but up from 46.5; and mixed practice, 46.6, down from 48.4.

Privately-owned housing starts in February dipped 0.2% at a seasonally adjusted annual rate from an upwardly revised January total, the Census Bureau reported last Tuesday. Starts may have been depressed by unusually harsh winter weather in much of the country. Single-family starts edged up 0.3%, while multifamily (5 or more units) starts slipped 2.5%. Building permits, which are less susceptible than starts to weather disruptions and are a generally reliable indicator over time of future starts, rose 7.7% as a 28% surge in multifamily permits more than offset a 1.8% drop in single-family permits.

“The increased availability of inexpensive natural gas is driving project activity in other sectors, perhaps most notably the chemical processing industry, which is experiencing high spending growth, due in large part to a sharp increase in the construction of new ethylene and methanol units, which require significant time, resources and manpower to construct,” project-tracking firm Industrial Info Resources reported on Wednesday (subscription required). “Current forecasts show labor demand in the overall Gulf Coast region peaking in 2016, with labor demand for eight skilled crafts, including electricians, welders, pipefitters, iron workers and others, approaching 91,000 skilled craftsmen for the year, compared to approximately 53,770 in 2013.”

The Data DIGest is a weekly summary of economic news; items most relevant to construction are in italics. All rights reserved. Sign up at www.agc.org/datadigest.

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