The number of open, unfilled construction sector jobs rebounded in May as the overall economy improved from the start of the year.
According to the BLS Job Openings and Labor Turnover Survey (JOLTS), the number of open construction sector jobs increased on a seasonally adjusted basis from 92,000 in April to 130,000 in May. The May count of unfilled construction jobs is the third highest since the end of the Great Recession.
On a three-month moving average basis, the open position rate for the construction sector held at 1.83% for the month of May. While the open rate has declined somewhat in recent months, the present rate of open jobs in construction remains above any rate witnessed after the recession and prior to 2013.
Monthly gross hiring in construction increased, rising on a seasonally adjusted basis from 286,000 to 312,000 from April to May. Over the same period, the hiring rate, as measured on a 3-month moving average basis, ticked up to 4.8% for May.
Two trends in the construction sector are worth noting. First, the layoff rate for the sector (graphed above as a 12-month moving average) has continued to fall. Second, the sector hiring rate has fallen noticeably since the fall of 2013. The trend lines over the last two years – a falling hiring rate, an elevated open rate, and a declining layoff rate – are consistent with some construction firms having trouble contracting with workers for specific projects.
It is also worth noting that, on a seasonally adjusted basis, the construction sector unemployment rate stands at 9.1% for June (one month ahead of the JOLTS data), down from 10.8% a year ago. Construction sector unemployment peaked at 22% (seasonally adjusted basis) in February 2010.
Monthly employment data for June 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 2.266 million, broken down as 661,000 builders and 1.606 million residential specialty trade contractors.
Over the last year the residential construction sector has added 106,000 jobs. Since the point of peak decline of home building employment, when total job losses for the industry stood at 1.466 million, 282,600 positions have been added to the residential construction sector. As of June, over the last six months the home building and remodeling industry has added on average more than 9,000 jobs per month.
For the economy as a whole, the May JOLTS data indicate that the hiring rate was constant at 3.4% of total employment. The hiring rate has been in the 3.1% to 3.4% range since January 2011. The overall job openings rate (3.2%) is higher than the 2.7% to 2.9% range it has been in since the start of 2013. This may represent good news for future job creation after a tough winter.