Construction job loss shows decline in April
While the pace of job loss continues to be brisk and unemployment will likely peak around or above 10 percent before reversing course, the employment report is consistent with a sea of other recently released economic data that foreshadow a slow economic recovery.
The pace of layoffs in the nation’s nonresidential building construction sector slowed in April 2009, according to the May 8 employment report by the U.S. Labor Department. The total number of jobs declined by 9,100 last month — in comparison to the 10,600 job losses in March. On a year-over-year basis, nonresidential building construction employment has fallen by 87,700 jobs and now stands at 748,600.
In contrast, the nation’s residential building construction sector lost 12,600 jobs in April, down from 17,500 jobs lost in March. Since April 2008, 146,600 jobs have been lost in the residential building construction industry. Total private construction employment, which includes specialty trade contractors, lost 110,000 jobs in April, but this was much lower than the 135,000 jobs lost in March. On a year-over-year basis, the construction industry has lost nearly 1,000,000 jobs.
Overall, national employment fell by 539,000 for the month. More than 5.2 million jobs have been lost over the past 12 months, and roughly 5.7 million jobs have been lost since the beginning of the recession in December 2007.
The latest employment report indicates that the nation lost more than half a million jobs in April, and revisions to earlier months bring that number to more than 600,000. Normally, this would be viewed as very bad news, but some observers are interpreting the latest jobs numbers as additional evidence of economic stabilization.
For those in the nonresidential construction industry, this is welcome news. Though recovery within many nonresidential construction segments remains months or even years away, the ongoing stabilization of the broader economy is consistent with the notion that demand for new construction will begin to emerge later this year and into 2010. The stimulus package represents an important element in that formula. With the broader economy beginning to recover even before the stimulus package has had a major impact, the implication is that better times are ahead.
Anirban Basu is chief economist for Associated Builders and Contractors.