Backward-looking data from the Job Openings Labor Turnover Survey (JOLTS) detail the sudden stop associated with the coronavirus and its impacts on the construction labor market. According to the separate BLS labor market report, there were 422,000 jobs lost in the residential construction sector alone in April, followed by a more promising gain of 226,000 in May. Next month’s JOLTS data should reflect this more positive direction for jobs.
However, the April data showed an increase of the layoff rate from a revised 7.9% in March to 10.4% in April. This was the highest rate recorded in the history of the JOLTS data, which began at the end of 2001. The largest layoff rates were recorded in arts/entertainment/recreation (23%). In total, the construction sector recorded almost 1.3 million layoffs during March and April.
The one-year moving average estimates will more fully reflect the sudden stop of the labor market in the spring as future months’ data are published.
However, the April data nonetheless show a job openings count in construction of 256,000, despite the historic nature of the shutdown of parts of the U.S. economy. Given the May gain for home builder and remodeling employment, the construction rate in next month’s JOLTS report show show momentum for hiring in the construction sector.
As a technical note, BLS did indicate that the JOLTS survey was affected by the current environment. The BLS reported the response rate fell from a typical 54% to just 44%, which could affect the quality of the data.