A Strong Start for 2020

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The labor market started the new year with a solid gain. Total payroll employment increased by 225,000 and the unemployment rate was 3.6% in January. Residential construction employment increased by 20,200 in January, the largest gain in the past twelve months. Total construction industry (both residential and nonresidential) employment totaled about 7.6 million in January.

The Bureau of Labor Statistics released the Employment Situation Summary for January. Total nonfarm payroll employment rose by 225,000 in January, following a revised increase of 147,000 jobs in December. Over the past twelve months, total nonfarm payroll employment rose by 2.1 million.

BLS revised seasonally adjusted data from January 2015 forward. Monthly growth in total nonfarm payroll employment for 2019 was revised downward from 2,108,000 to 2,096,000 on a seasonally adjusted basis.

Meanwhile, the unemployment rate inched up to 3.6% in January from 3.5% in December, but still near a 50-year low. Over the month, the number of employed persons was little changed (-89,000), while the number of unemployed persons increased by 139,000. The labor force participation rate, the proportion of the population either looking for a job or already with a job, ticked up by 0.2 percentage points to 63.4% in January.

Additionally, monthly employment data released by the BLS Establishment Survey indicates that employment in the overall construction sector increased by 44,000 in January. The number of residential construction jobs increased by 20,200 in January. It marks the largest gain in the past twelve months. In January, residential specialty trade contractors increased by 17,800, accounting for most of the gain in residential construction employment.

Residential construction employment now stands at 2.9 million in January, broken down as 831,000 builders and 2.1 million residential specialty trade contractors. The 6-month moving average of job gains for residential construction is 5,767 a month. Over the last 12 months, home builders and remodelers added 43,800 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 959,100 positions.

In January, the unemployment rate for construction workers remained unchanged at 4.5% on a seasonally adjusted basis. The unemployment rate for the construction sector has been trending downwards since February 2010 and remains historically low.



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