Significant Increase in Unfilled Construction Jobs During 2013

The number of open, unfilled construction sector jobs increased 51% from 95,000 in December of 2012 to 143,000 in December of 2013, according to the BLS Job Openings and Labor Turnover Survey (JOLTS). The count of open jobs in the sector is the highest since May 2008.

While the recent increase in unfilled positions is consistent with the increase in construction sector activity, particularly for home building, the data continue to reflect only modest growth in total employment. The rise in the count of open positions thus matches reports of local labor shortages.

For the construction sector, monthly gross hiring fell back, declining on a seasonally adjusted basis from 293,000 to 269,000 from November to December. Over the same period, the hiring rate, as measured on a 3-month moving average basis, fell from 5.2% to 5.0%. The pace of construction hiring slowed during 2013 compared to 2012 levels.

construction labor market_Dec.png

Measured as a three-month moving average, the openings rate (the blue line above) has staged a noticeable rise since September 2012, with a brief pause during the middle of 2013. As of December, the three-month moving average stood at 2.3%, a post-recession high. This recent increase in open positions occurred at the same time as the hiring rate began to fall.

Combined with a declining sector layoff rate (non-seasonally adjusted), charted as a 12-month moving average in the graph above, the uptick in open positions since 2012 suggests more, if modest, construction hiring in the months ahead – if firms can find workers with the right skills.

Revised monthly employment data for January 2014 (the employment count data from the BLS establishment survey are published one month ahead of the JOLTS data) indicate that total employment in home building stands at 2.231 million, broken down as 647,000 builders and 1.584 million residential specialty trade contractors.

res construction_Jan

According to the BLS data, over the last year the home building sector has added 121,000 jobs. Since the point of peak decline of home building employment, when total job losses for the industry stood at 1.466 million, 247,000 positions have been added to the residential construction sector. As of January, over the last six months the industry has added on average more than 10,000 jobs per month.

For the economy as a whole, the November JOLTS data indicate that the hiring rate dipped to 3.2% of total employment. The hiring rate has been in the 3.1% to 3.4% range since January 2011. The current overall job openings rate (2.8%) has been at this level for three out of last four months.



Tags: , , ,