Construction industry adds nearly 200K jobs over past year
In May, not seasonally adjusted (NSA) construction unemployment rates were down in 24 states on a year-over-year basis, according to analysis released by Associated Builders and Contractors. At the same time, the construction industry employed 192,000 more workers than in May 2016, according to data from the U.S. Bureau of Labor Statistics, and the national NSA construction unemployment rate was 5.3 percent, up 0.1 percent from a year ago.
Because these industry-specific rates are not seasonally adjusted, national- and state-level unemployment rates are best evaluated on a year-over-year basis.
Despite the year-over-year increase, this was the third lowest national not seasonally adjusted May construction unemployment rate on record and the second lowest rate since May 2000. Also, as in April, all the states except two, Alaska and New Mexico, had estimated construction unemployment rates below 10 percent.
Since the beginning of the data series in January 2000, the monthly movement in the national NSA construction unemployment rate from April to May has decreased every year, except one — 2009. This trend continued in 2017 with a 1 percent rate drop in the NSA rate from April. Among the states, 39 had declines in their May estimated rate from April, and two (Arkansas and Rhode Island) saw no change.
The states with the lowest estimated NSA construction unemployment rates in order from lowest rate to highest were: Vermont, 1.5 percent; Iowa, 2.2 percent; Idaho, 2.3 percent; Colorado, 2.4 percent; and Indiana and North Dakota (tie), 2.5 percent. Four states — Colorado, Idaho, Indiana and Iowa — also were among the top five in April.
Colorado, with a 2.4 percent rate, had the fourth lowest rate in May, the state’s second lowest estimated May rate on record. Indiana’s rate was 2.5 percent, the lowest May rate on record and the third largest year-over-year decline among the states, down 2.1 percent. North Dakota’s 2.5 percent rate was its lowest May rate on record.
New Hampshire, which had tied with Idaho and Indiana for lowest rate in April based on revised data, dropped to 15th lowest in May, with a 3.8 percent estimated construction unemployment rate. Despite New Hampshire having the country’s largest monthly increase, up 1.2 percent, it was the state’s second lowest May rate since 2004 (3.1 percent), behind last year’s 3.4 percent.
The states with the highest NSA construction unemployment rates in order from lowest to highest rates were: Missouri, 7.9 percent; Mississippi, 8.4 percent; Pennsylvania, 9.3 percent; Alaska, 10.5 percent; and New Mexico, 10.7 percent.
Three of these states — Alaska, New Mexico and Pennsylvania — also were among the five states with the highest construction unemployment rates in April. New Mexico had the highest estimated NSA construction unemployment rate in May, 10.7 percent, down from the second highest ranking in April.
Alaska ended its eight-month streak as the state with the highest construction unemployment rate. A high unemployment rate for the state at this time of year is to be expected since these are not seasonally adjusted construction unemployment rates. Interestingly, the state posted the largest year-over-year increase (up 3.5 percent) in May while also posting the largest monthly rate drop in the country (down 5.8 percent).
Pennsylvania had the second largest year-over-year rate increase and the fourth largest monthly rate increase among the states. Mississippi had the sixth largest year-over-year increase in the country, up 1.2 percent, and the fifth largest monthly increase, up 0.7 percent. Missouri’s 1.5 percent year-over-year increase was the third largest in the country. Nonetheless, it was Missouri’s second lowest May construction unemployment rate since 2006 (6.1 percent), behind last year’s 6.4 percent rate.
Louisiana, which had the third highest rate in April, improved to 11th highest in May, along with Nevada and Ohio, with a 6.3 percent rate. It was Louisiana’s lowest May construction unemployment rate since 2006 (4.3 percent). Illinois, which had the fourth highest rate in April, improved to 17th highest in May, tied with Alabama, with a 5.9 percent rate. It was the state’s lowest May construction unemployment rate since 2000 (5.7 percent).
Bernard M. Markstein, Ph.D., is president and chief economist of Markstein Advisors. He conducted the employment analysis for Associated Builders and Contractors.