Job Growth Surged in December

At the end of 2018, job growth surged. Total employment increased by 312,000 in December and the unemployment rate rose to 3.9%; however, this increase was good news because it was generated by growth in the labor force.

Residential construction employment increased by 1,700 in December. The total construction industry (residential and nonresidential) added 280,000 jobs in 2018, more than the gain of 250,000 jobs in 2017.

According to the Employment Situation for December released by the Bureau of Labor Statistics (BLS), total nonfarm payroll employment rose by 312,000, faster than the upwardly revised increase of 176,000 jobs in November. It was the biggest monthly gain since February 2018. In 2018, job gains have averaged 220,000 per month, about 20% higher than the average monthly growth of 182,000 over all of 2017. Over the past twelve months, total nonfarm payroll employment rose by 2.6 million, compared with the increase of 2.2 million in 2017.

However, the strong job growth in December did not produce a lower unemployment rate. The unemployment rate rose by 0.2 percentage point to 3.9% in December. Meanwhile, the labor force participation rate, the proportion of the population either looking for a job or already with a job, increased by 0.2 percentage point in December, to 63.1%. The increase in the number of labor force reflected both a 142,000 increase in the number of person employed and a 276,000 rise in the number of person unemployed over the month.

Monthly employment data released by the BLS Establishment Survey indicates that employment in the overall construction sector rose by 38,000 in December. The number of residential construction jobs rose by 1,700 in December, less than a 4,300 increase in November.

Residential construction employment now stands at 2.85 million in December, broken down as 816,000 builders and 2.0 million residential specialty trade contractors. The 6-month moving average of job gains for residential construction is 6,567 a month. Over the last 12 months, home builders and remodelers added 99,800 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 871,400 positions.

In December, the unemployment rate for construction workers rose to 4.6% on a seasonally adjusted basis, from the 4.3% in November. The unemployment rate for the construction sector has been trending downwards since February 2010 and remains historically low.



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