Construction Employment Changes Little in January


Total payroll employment rose by 49,000 and the unemployment rate fell to 6.3% for the month. The labor market continues its slow recovery amid the COVID-19 pandemic.

In January, residential construction employment remained virtually unchanged (-600), after increasing for eight straight months. Meanwhile, non-residential construction lost 1,900 positions, after four consecutive months of gain. Currently, job gains in residential construction offset all the jobs lost in March and April, while only 60% of non-residential construction jobs lost in March and April have been recovered. Aggregate construction industry (both residential and non-residential) employment totaled 7.4 million in January.

In January, total nonfarm payroll employment increased by 49,000, reported in the Employment Situation Summary. The January gain followed a decline of 227,000 jobs in December, the first loss after seven consecutive months of increases. The monthly change in payroll employment for December was revised down by 87,000, from its original estimate of a 140,000 decrease.

Due to the impact of the COVID-19 pandemic, the economy lost 22.6 million jobs in March, April and December of 2020. By the first month of 2021, 12.7 million jobs have been recovered, however, total nonfarm employment is still 9.9 million lower than its February level.

Meanwhile, the unemployment rate fell by 0.4 percentage points to 6.3% in January. It was 8.5 percentage points lower than its recent high of 14.8% in April and 1.9 percentage points higher than the rate in February 2020.

Meanwhile, the labor force participation rate, the proportion of the population either looking for a job or already with a job, declined by 0.1 percentage points to 61.4% in January. The decline in the labor force participation rate was caused by the increase in the number of persons not in the labor force and the decrease in the number of persons in the labor force. The decrease in the number of persons in the labor force reflected both a 201,000 increase in the number of persons employed and a 606,000 decline in the number of persons unemployed over the month.

In January, employment in professional and business services rose notably by 97,000. Temporary help services accounted for most of the gain in professional and business. Meanwhile, government and educational services had job gains as well. Employments in leisure and hospitality, health care and social assistance, retail trade, and transportation and warehousing declined.

Additionally, according to the Household Survey supplemental data, which come from questions added to the Current Population Survey (CPS) since May 2020, 23.2% of employed persons teleworked or worked at home in the last 4 weeks specifically because of the coronavirus pandemic in January, down from 23.7% in December. In January, 14.8 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, 12.7% received at least some pay from their employer for the hours not worked.

Employment in the overall construction sector declined by 3,000 in January, following eight consecutive months of growth. Residential construction lost 600 jobs in January, after adding 16,100 jobs in December. From May to December in 2020, 472,700 residential construction jobs were created, offsetting all the 468,900 residential construction jobs lost in March and April due to the pandemic.

Residential construction employment now stands at 3.0 million in January, broken down as 848,000 builders and 2.1 million residential specialty trade contractors. The 6-month moving average of job gains for residential construction was 19,400 a month. Over the last 12 months, home builders and remodelers added 27,600 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 1,002,000 positions.

In January, the unemployment rate for construction workers declined to 7.5% on a seasonally adjusted basis. After reaching 14.1% in April due to the impact of the COVID-19 pandemic, the unemployment rate for construction workers has been trending lower for the past nine months.

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