Jobs in residential construction are vanishing. The sector lost roughly 6,700 jobs in the past month, according to June employment numbers released this morning by the U.S. Bureau of Labor Statistics. Specialty residential trade contractors are also hurting; this industry lost 14,300 jobs in June.
“Over the last three months, the construction sector has experienced the greatest job losses out of the ten most important sectors,” noted analyst Ivy Zelman of Zelman and Associates. “Since the peak, jobs related to residential construction have fallen 17 percent and residential contractor employment has declined 15 percent.”
Overall, the country lost 62,000 jobs last month. Unemployment remained stable, at 5.5 percent.
But economists found little cheer in the pre-holiday numbers. “Although the headline decline in payrolls was roughly in line with published consensus expectations, it is fair to say that the markets had feared worse. But the report can't be seen as good news,” said Nigel Gault, chief U.S. economist at research firm Global Insight of Lexington, Mass. “Private payrolls fell 91,000, with losses widespread across manufacturing, construction, and private services with the exception of health, education, and food services.”
Unfortunately for builders and contractors, Zelman doesn’t think construction employment will rebound anytime soon. “As this housing cycle is turning out to be as bad or worse than prior ones and non-residential demand is diminishing, we believe construction payrolls could decline another 10 percent to 15 percent, resulting in a drag on the national economy of 720,000 to 1.08 million jobs, or 0.5 percent to 0.8 percent of the workforce,” she said.
For more detail, visit http://www.bls.gov/news.release/empsit.nr0.htm.
Alison Rice is senior editor, online, at BUILDER magazine.