Construction employment lagging pre-pandemic levels in most states

Construction employment in January remained below pre-pandemic levels in all but eight states, according to an Associated General Contractors of America (AGC) analysis of government employment data.

Also, more firms have reduced headcount than have added to it in the past year, a recent AGC survey shows. AGC officials say the jobs figures and survey results underscore the need for federal measures to stem future sector job losses.

“Despite improvement in many sectors of the economy, nonresidential contractors are coping with widespread project cancellations and postponements, soaring materials costs and lengthening delivery times,” says Ken Simonson, AGC’s chief economist. “That combination makes further job cuts likely in many states.”

The AGC survey, which included responses from nearly 1,500 firms, found 34 percent had reduced their employee count in the past year, compared to just 20 percent that had added employees. More than three-fourths of the firms had experienced project cancellations or deferrals, while only 21 percent reported winning new projects or add-ons to existing projects in the past two months.

Seasonally adjusted construction employment in January was lower than in February 2020 – the last month before the pandemic forced many contractors to suspend work – in 42 states. Also, it was unchanged in the District of Columbia.

Texas lost the most construction jobs over the period (51,900 jobs, or down 6.6 percent), followed by California (36,200 jobs, down 4 percent) and New York (26,000 jobs, down 6.4 percent). Louisiana experienced the largest percentage loss (14.0 percent, down 19,200 jobs), followed by Wyoming (9.6 percent, down 2,200 jobs).

Only eight states added construction jobs from February 2020 to this January. Idaho added the most jobs (4,500 jobs, up 8.2 percent), trailed by Utah (3,300 jobs, up 2.9 percent), Alabama (6,100 jobs, up 6.4 percent) and Arkansas (1,900 jobs, up 3.6 percent,). Idaho added the highest percentage, followed by Arkansas and Alaska (3 percent, up 500 jobs).

From December to January, 19 states and Washington, D.C., lost construction jobs; 27 states added jobs; and there was no change in Alaska, North Dakota, South Dakota and Wyoming.

California had the largest loss of construction jobs for the month (4,000 jobs or down 0.5 percent), followed by South Carolina (3,200 jobs, down 3 percent) and Illinois (3,200 jobs, down 1.4 percent). South Carolina had the largest percentage decline, followed by Wisconsin (2.4 percent, down 3,000 jobs).

Florida added the most construction jobs over the month (3,500 jobs, up 0.6 percent), followed by Texas (up 0.4 percent). Vermont had the largest monthly percentage gain (3.4 percent, up 500 jobs), trailed by Idaho (3.3 percent, up 1,900 jobs).

AGC officials say demand for construction will continue to suffer amid pandemic-induced economic uncertainty. They urge federal officials to enact measures to help stem additional job losses in the construction sector. The new measures should include new federal investments in infrastructure, ending tariffs on key construction materials, addressing supply chain backups and avoiding costly and unneeded new regulatory burdens, AGC says.

“The pandemic is driving away projects, contributing to spiking materials prices and helping make delivery schedules unreliable,” says Stephen Sandherr, AGC’s CEO. “Contractors will not be able to build back better if they have to keep paying higher prices for materials that rarely arrive on time.”