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Nonfarm payroll employment in January increased by 304,000, seasonally adjusted, from December and by 2,807,000 (1.9%) year-over-year (y/y) from January 2018, the Bureau of Labor Statistics (BLS) reported. The unemployment rate, 4.0%, increased slightly from December (3.9%) but decreased slightly from January 2018 (4.1%). Construction employment increased by 52,000 for the month and 338,000 (4.7%) y/y to 7,464,000, the most since January 2008. Averageweekly hours in construction rose to 39.9 hours for all employees and 40.6 hours for production and nonsupervisory employees. These were the highest averages for these series since they began in 2006 and 1947, respectively. The unemployment rate in construction, not seasonally adjusted, fell to 6.4% (from 7.3% in January 2018), and the number of unemployed jobseekers with construction experience declined to 638,000 (down from 707,000). These were the lowest January figures in the 19-year history of both series. (Not-seasonally-adjusted data may be affected by normal weather and holiday patterns and thus should not be compared to levels in other months.) BLS made routine annual benchmarking adjustments in 2014-2018 employment totals.
Construction spending totaled $1.300 trillion at a seasonally adjusted annual rate in November, up 0.8% from the downwardly revised October rate and up 3.4% from November 2017, the Census Bureau reported Friday in a release that was delayed a month by the government shutdown. (The date for the December data, which was due Friday, has not been announced.) Public construction decreased 0.9% for the month but rose 7.0% y/y. Of the three largest public segments, highway and street construction gained 1.7% for the month and 5.8% y/y; educational construction, -2.0% and 8.5%, respectively; and transportation, -0.1% and 14% (26% y/y for state and local airport construction and 5.6% y/y for other public transportation—port, transit and passenger rail). Private nonresidential construction spending slid 1.2% for the month but increased 4.2% y/y. Of the four largest components, power (electric power plus oil and gas pipelines and field structures) fell 0.9% for the month but rose 8.9% y/y; commercial, -2.3% and -1.3%, respectively (with retail, -11% y/y, and warehouse, 11% y/y); manufacturing, -0.3% and 0; and office, -1.5% and 10%. Private residential spending rose 3.5% in November and 0.8% y/y. New multifamily construction increased 2.6% and 8.3%, respectively; new single-family construction, -1.8% and -1.0%; and residential improvements (a series that frequently has large revisions), 12% and 1.1%.
Construction employment, not seasonally adjusted, increased between December 2017 and December 2018 in 273 (76%) of the 358 metro areas (including divisions of larger metros) for which BLS provides construction employment data, fell in 37 (10%) and was unchanged in 45, according to an AGC analysis posted on Tuesday. (BLS combines mining and logging with construction in most metros to avoid disclosing data about industries with few employers.) The largest gains again occurred in Houston-The Woodlands-Sugar Land (19,400 construction jobs, 9%), followed by the Dallas-Plano-Irving metro division (17,700 combined jobs, 13%), Phoenix-Mesa-Scottsdale (16,200 construction jobs, 14%), Orlando-Kissimmee-Sanford (11,400 construction jobs, 15%), Atlanta-Sandy Springs-Roswell (10,700 construction jobs, 9%) and Nassau County-Suffolk County, N.Y (10,100 combined jobs, 13%). The largest percentage gains again occurred in Weirton-Steubenville, W.Va.-Ohio (28%, 500 combined jobs), followed by Hartford-West Hartford-East Hartford, Conn. (23%, 4,300 combined jobs); Bridgeport-Stamford-Norwalk, Conn. (23%, 2,600 combined jobs) and Lewiston, Idaho-Wash. (23%, 300 construction jobs). The largest job loss was in the Anaheim-Santa Ana-Irvine, Calif. division (-2,800 construction jobs, -3%), followed by San Diego-Carlsbad (-1,900 construction jobs, -2%) and Urban Honolulu (-1,500 combined jobs, -5%). The largest percentage loss occurred in the Lawrence-Methuen Town-Salem, Mass.-N.H. division (-9%, -300 combined jobs), followed by Abilene, Texas (-7%, -300 combined jobs); Wichita Falls, Texas (-7%, -200 combined jobs) and Elmira, N.Y. (-7%, -100 combined jobs). Employment hit a record high for December in 80 metros (dating back in most areas to December 1990); four areas set a new December low.
"Construction costs increased in January" for the 25th month in a row, IHS Markit and the Procurement Executives Group (PEG) reported on Wednesday. "Although prices are still rising,...these increases continue to be less widespread. Materials and equipment prices rose in January...Price increases were recorded in eight of the 12 subcomponents in January. Ready-mix concrete and fabricated structural steel registered flat pricing, while carbon steel pipe and alloy steel pipe once again experienced price declines. All other categories had increasing prices....Current subcontractor labor price increases were slightly more widespread in January."
The employment cost index—a measure of compensation (wages, salaries and benefits, including required payments), which BLS released on Thursday for the fourth quarter (Q4) of 2018, accelerated slightly in 2018. In the private sector as a whole, total compensation increased 0.6%, seasonally adjusted, from September to December and 3.0% from Q4 2017 to Q4 2018 (up from 2.6% in 2016 to 2017). Compensation for all employees in the construction industry increased 0.5% in Q4 and 2.8% for all of 2018 (vs. 2.4% in 2016 to 2017). The index for wages and salaries in the construction industry matched the Q4 and full-year 2018 increases for all private-industry workers, rising 0.5% in Q4 and 3.1% for all of 2018 (vs. 2.5% in 2017).
Union membership declined from 14.8 million (10.7% of employed workers) in 2017 to 14.7 million (10.5%) in 2018, BLS reported on January 18. Construction industry membership declined from 1,102,000 (14.0%) to 1,048,000 (12.8%).