Construction Jobless Rate Climbs To 19.4% in November

December 7, 2009

By Tom Ichniowski
This story first appeared in Engineering News-Record

Construction's unemployment rate continued to to rise in November, climbing to 19.4% from October's 18.7%, while the nation's overall jobless rate declined slightly, the Bureau of Labor Statistics has reported.

Job creation has become a prime topic in Washington, as congressional Democrats work on new measures aimed at bringing more people back to work. Infrastructure spending is emerging as one component of those possible measures.

Construction Unemployment Rate, Last 13 Months

Note: Rates are not seasonally adjusted.
Source: U.S. Dept. of Labor Bureau of Labor Statistics
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The November data, released Dec. 4, showed that construction continued to lose jobs for the month, but in a modestly encouraging sign, the industry's 27,000 jobs shed was less than 117,000 monthly average for the six months ended in April and the 63,000 per month in the May-October period.

In fact, BLS said that the heavy and civil construction sector showed a gain of 5,200 jobs in November compared with October, adjusted for seasonal variations.

Nevertheless, notes Ken Simonson, the Associated General Contractors' chief economist, "The fact fewer people lost their jobs in construction this month is little solace for the one in five construction workers out of a job today."

Simonson says that the reduced construction job losses in November probably can be traced to good weather during the month in much of the country.

Construction's recent peak unemployment rate was 21.4% in February. The industry's rate is not seasonally adjusted.

The overall national unemployment rate improved in November, dipping to 10.0%, from 10.2% the previous month, seasonally adjusted.

Anirban Basu, Associated Builders and Contractors' chief economist, said that the overall November report "blew away even the most optimistic expectations." He added that the construction industry "will enter 2010 with momentum."

But Basu notes that "nonresidential specialty trade contractors are feeling the pain." BLS says that that sector saw 29,000 jobs lost in November.

Basu says that the improvements in the heavy-civil and residential sector are linked largely to the effect of federal spending. That would include the stimulus from the American Recovery and Reinvestment Act, signed into law in February.

But Basu adds that "the impact of stimulus dollars is not eternal." He says, "While the next several months are shaping up to be a time of improvement for the U.S. economy and for the nonresidential construction industry, how lengthy the recovery will be remains in doubt."

As the stimulus act funding winds down, AGC CEO Stephen Sandherr noted that overall 2010 federal highway and transit spending is projected to decline by $15 billion, or almost 20%, compared with 2009 levels. He called on Congress and the Obama administration to include increased public-works spending in any new jobs-producing legislation.


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