Most states added construction jobs last year but not in April; starts fell, MHC says
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In April, seasonally adjusted nonfarm payroll employment increased from a year earlier in 47 states and the District of Columbia and decreased in three states, the Bureau of Labor Statistics reported on May 17. Seasonally adjusted construction employment climbed in 29 states and fell in 21 states and the District of Columbia, an AGC analysis showed. Hawaii had the largest percentage gain in construction jobs (11.5%, 3,300 jobs), followed by Alaska (9.1%, 1,500 jobs) and Louisiana (8.1%, 10,200 jobs). California added the most new construction jobs over the past 12 months (44,800, 7.7%), followed by Texas (41,500 jobs, 7.1%). Vermont lost the highest percentage (-11.3%, -1,700 jobs), followed by South Dakota (-9.6%, -2,100 jobs) and Rhode Island (-8.6%, -1,400 jobs). Illinois lost the most jobs (-12,900 jobs, -6.8%), followed by Ohio (-9,200 jobs, -5.0%) and Indiana (-5,600 jobs, -4.4%). From March to April, seasonally adjusted construction employment rose in 17 states, fell in 32 plus D.C. and was unchanged in New Hampshire. (BLS combines mining and logging with construction in D.C., Hawaii, South Dakota and four other states to avoid disclosing data about industries with few employers.)
"New construction starts in April settled back 1% [at] a seasonally adjusted annual rate,” McGraw Hill Construction (MHC) reported on May 20. “The public works sector retreated [-7%] from its elevated pace in March, and housing experienced a slight loss of momentum [-1%]. Meanwhile, nonresidential building in April showed some improvement [6%] after its lackluster performance during the previous two months. On an unadjusted basis, total construction starts in the January-April period of 2013 [were] down 5% from the same period a year ago. The 2013 year-to-date amount of total construction was pulled down by a sharply reduced volume of new electric utility starts. If electric utilities are excluded, total construction starts would be up 12% year-to-date, with most of the lift coming from this year’s stronger rate of homebuilding.” Robert Murray, MHC’s vice president of economic affairs, commented, “The boost that had been expected to come in 2013 from nonresidential building is at best only beginning to take hold, as the pickup in April followed weak activity in February and March. One relative bright spot so far in 2013 has been a stronger-than-expected amount of public works construction, although its April downturn may well be a sign of diminished activity to come.
“After cutting spending on public colleges and universities during the economic crisis, many state governments have begun to boost higher-education budgets once again,” the Wall Street Journal reported today. “The turnaround began last year, when 32 states increased funding to public colleges and universities for the current academic year, up from 17 states the year before, according to data from an annual survey by Illinois State University….It isn’t clear yet how many states will increase funding for the current academic year because many haven’t yet completed their budgets….The states that already have raised their higher-education budgets have various plans for spending the new money. In Indiana, about $388 million of the $500 million in new funds will be used for capital improvements at schools, mostly to refurbish older buildings, said Teresa Lubbers, Indiana’s Commissioner for Higher Education, who oversees funding for state colleges and universities.” However, combined state and local higher education construction spending fell in March to the lowest level in five years, according to construction spending data the Census Bureau released on May 1. The March total, $21.4 billion at a seasonally adjusted annual rate, was down 19% from the record set in March 2009. Construction at private colleges and universities rebounded last year but decreased nearly 10% from June 2012 to $10.9 billion in March. “Last fall, enrollment fell at 46% of the 383 private colleges in the new [National Association of College and University Budget Officers] survey as the pool of high-school seniors declined,” the Journal reported on May 6.
The growing production of crude oil and natural gas in the United States is leading to new investments by ports and other facilities. The Energy Department on May 17 approved exports of liquefied natural gas from a terminal in Quintana Island, Texas, although construction must be approved by approved by the Federal Energy Regulatory Commission. “Targa Sound Terminals will invest at least $80 million in a Port of Tacoma terminal to receive crude oil brought by railroad from Montana, at a site where a container terminal was once planned,” the Puget Sound Business Journal reported on Friday. “Several other projects to handle crude oil brought in by rail are planned in Washington.”
“While project delays, waiting reviews, and municipal approvals are standard in the architecture profession, most firms feel that the situation has gotten worse recently with uncertain economic conditions and client difficulties in obtaining financing,” the American Institute of Architects reported on Friday in its Work-on-the-Boards newsletter. “Firms now report that projects are on hold an average of a quarter of the time during the design phase, either for anticipated or unanticipated reasons. Even with the generally longer times that projects are on hold, architecture firms report that recent projects have been smaller on average, and have a shorter design phase than typical projects during the last construction boom.”
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