Eye On Housing
In August, total payroll employment rose by 1.4 million and the unemployment rate fell to 8.4%. The U.S. labor market continues to recover from the COVID-19 crisis.
Residential construction employment rose by 27,700 in August to 2.9 million. Total construction industry (both residential and nonresidential) employment rebounded to 7.2 million in August. It is worth noting, however, that nonresidential construction employment declined by 5,500, highlighting the different fortunes of housing vs. non-housing construction.
In the Employment Situation Summary for August, total nonfarm payroll employment increased by 1.4 million, after increases of 4.8 million in June and 1.7 million in July. The previous two months’ gains were revised lower. The June increase was revised down by 10,000 from 4,791,000 to 4,781,000, and the July increase was revised down by 29,000 from 1,763,000 to 1,734,000.
After the economy lost 22.1 million jobs in March and April due to the impact of the COVID-19 pandemic and efforts to contain it, about 10.6 million jobs have been created in the past four months, indicating the economy is recovering from the COVID-19 pandemic gradually. In August, total nonfarm employment was 11.5 million lower than its February level.
Meanwhile, the unemployment rate declined by 1.8 percentage points to 8.4% in August. In August, the number of employed persons increased by about 3.8 million, while the number of unemployed persons declined by 2.8 million to 13.6 million. The labor force participation rate, the proportion of the population either looking for a job or already with a job, rose by 0.3 percentage point to 61.7% in August.
In August, employment in government increased by 344,000, accounting for 25% of the monthly gain in total payroll employment. This August increase in government employment largely reflected temporary hiring for the 2020 Census. Retail trade, professional and business services, leisure and hospitality, and education and health services had the significant job gains in August, while mining and logging continued to decline.
Additionally, according to the Household Survey supplemental data, which come from questions added to the Current Population Survey (CPS) since May 2020, in August, 24.3% of employed persons teleworked or worked at home in the last 4 weeks specifically because of the coronavirus pandemic. Meanwhile, there are 24.2 million persons reported that they had been unable to work at some point in the last 4 weeks because their employer closed or lost business due to the coronavirus pandemic. Among those who reported that they were unable to work due to pandemic related closures, 11.6% received at least some pay from their employer for the hours not worked.
Employment in the overall construction sector increased by 16,000 in August, after a revised increase of 27,000 jobs in July. The number of residential construction jobs rose by 27,700 in August, after an increase of 31,900 in July.
Residential construction employment now stands at 2.9 million in August, broken down as 820,000 builders and 2.1 million residential specialty trade contractors. The 6-month moving average of monthly job changes for residential construction is -14,450 a month, mainly reflecting the largest job loss in April. Over the last 12 months, home builders and remodelers shed 28,500 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 896,900 positions.
In August, the unemployment rate for construction workers dropped to 9.9% on a seasonally adjusted basis, from 11.3% in July. After hit 16.1% in April due to the impact of the COVID-19 pandemic, the unemployment rate for construction workers has been trending downward for the past four months.
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