Construction Employment Slips in 225 Metro Areas From January 2020 to January 2021

The Associated General Contractors of America’s recent analysis of government employment data and its own contractor survey shows that construction employment decreased from January 2020 to January 2021 in nearly two-thirds of the nation’s metro areas as more project cancellations and fewer new orders have forced firms to reduce their headcount. Association officials said more layoffs are likely for the industry amid spiking materials prices and uncertain demand for new projects.

“More contractors are telling us they are cutting headcount than adding workers, which is consistent with the new data showing the industry is shrinking in many parts of the country,” said Ken Simonson, the association’s chief economist. “More than three-fourth of the firms said projects had been postponed or canceled, while only one out of five reported winning new work or an add-on to an existing project in the previous two months as a result of the pandemic. That imbalance makes further job losses likely in many metros.”

Construction employment fell in 225 of 358 metro areas (or 63%) between January 2020 and January 2021. Industry employment was stagnant in 41 additional metro areas, while only 92 metro areas—26 %—added construction jobs.

Houston-The Woodlands-Sugar Land, Texas lost the most number of construction jobs over the 12-month period (-32,900 jobs, -14%), followed by New York City (-23,000 jobs, -15%); Midland, Texas (-11,100 jobs, -29%); and Chicago-Naperville-Arlington Heights, Ill. (-10,400 jobs, -9%). While those areas had the largest drop of specific jobs, Lake Charles, La. had the largest percentage decline (-40%, -8,100 jobs), followed by Odessa, Texas (-37%, -7,600 jobs); Midland; and Laredo, Texas (-27%, -1,100 jobs).

Sacramento–Roseville–Arden-Arcade, Calif. added the most construction jobs over 12 months (3,500 jobs, 5%), followed by Indianapolis-Carmel-Anderson, Ind. (3,100 jobs, 6%); Boise, Idaho (2,500 jobs, 9%); and Seattle-Bellevue-Everett, Wash. (2,100 jobs, 2%). Looking at the percentage of jobs added, Sierra Vista-Douglas, Ariz. had the highest percentage increase (42%, 1,000 jobs), followed by Bay City, Mich. (18%, 200 jobs); and Auburn-Opelika, Ala. (15%, 400 jobs).

Association officials are urging Congress and the Biden administration to work together to address rising materials prices, supply chain backups and invest in infrastructure. They are asking the administration to end tariffs on key construction materials, including steel and lumber, work with shippers to get deliveries back on track and pass the significant new infrastructure investments the president has promised.

“The construction industry won’t be able to fully recover and start adding jobs in significant numbers as long as materials prices continue to spike, deliveries remain unreliable and demand remains uncertain,” said Stephen E. Sandherr, the association’s chief executive officer. “Federal officials can’t fix every problem, but they can help by removing tariffs, helping hard-hit shippers and boosting investments in the nation’s infrastructure.”