Where are the Trades?


From 2006 to 2011, over 1.5 million trade contractors left the market. In spite of 111,000 unfilled positions as of August 2013, employees are not returning as rapidly as one might expect. In fact, a recent survey found the cost and availability of labor to be second most significant issue faced by builders behind only building material prices. Relatively poor labor market conditions and a shortage of construction labor represent a conundrum for home builders.

According to the Bureau of Labor Statistics (BLS), the peak in trade contractor employment in came on April 2006 when nearly 5 million trade contractors were employed. By January 2011, the recent low point or trough, 3.4 million trade contractors were employed. The majority of the loss came in residential construction as over 1 million employees were lost. In contrast, nonresidential construction only 620,000 employees were lost.


The recovery in trade contractor employment since the recent low, January 2011, has varied markedly across geography. Using the Quarterly Census of Employment and Wages (QCEW) published by the BLS it is possible to analyze state level changes in trade contractor employment from January 2011 to the first quarter of 2013.

The state analysis combines residential and non-residential trade contractors. This is done as employment is often transferable from residential to nonresidential. For example, an electrician engaged in residential construction could transfer their job skills to nonresidential construction.

The QCEW data is compiled from tax reports filed by employers and covers 98% of U.S. jobs. Although the QWEC is the most comprehensive source of residential construction employment statistics, the survey does not include self-employed workers. NAHB analysis of the 2010 American Community Survey suggests the residential construction sector registers the second highest share of self-employed among all industries.

From January 2011 to first quarter of 2013, 15 states saw less than 5% growth in trade contractor employment. The state with the largest percentage decrease in trade contractor employment since January 2011 was Maine with a loss of 0.9%.

From January 2011 to first quarter of 2013, 20 states and the District of Columbia saw an increase in trade contractor employment greater than 10%. The state with the largest percentage increase in employment was North Dakota with an increase of 47.1%. North Dakota experienced a significant increase in oil production over the time period.


The construction sector has seen a dramatic decrease in employment from 2006 to 2011. Residential trade contractors have accounted for the majority of the decrease. The recovery in employment has been uneven with some states experiencing further decreases and others experiencing significant increases. This analysis provides a snapshot of the relationship between of residential and nonresidential trade contractors as well as trade contractor employment across geography. Although the analysis does not answer the question of why trades are hard to find in a relatively poor labor market, the mobility of labor across industry and geography are important considerations.

Tags: , , ,

0 replies


  1. Eye on the Economy: New Home Sales Rise in October | Eye on Housing

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: