Despite Homebuilding Boom and Improving Economy, Construction Employment Declines in 203 Metro Areas

Construction employment decreased from March 2020 to March 2021 in 203, or 57%, of the nation’s metro areas, according to an analysis by the Associated General Contractors of America (AGC) of government employment data released today. Association officials said that the industry’s broader recovery in many parts of the country is being hampered by rising materials prices, supply chain disruptions and project cancellations.

“Nearly twice as many metros have lost construction jobs as gained them in the past 12 months, even though homebuilding has recovered strongly and the overall economy is in much better shape than it was a year ago,” said Ken Simonson, the association’s chief economist. “Nonresidential construction is still at risk of further declines in much of the country.”

Houston, The Woodlands, and Sugar Land, Texas, lost the largest number of construction jobs over the 12-month period (-31,000 jobs, -13%). Followed by New York City (-24,000 jobs, -15%); Midland, Texas (-10,000 jobs, -26%); Odessa, Texas (-8,000 jobs, -39%); and Nassau County-Suffolk County, N.Y. (7,900 jobs, -10%). Odessa had the largest percentage decline, followed by Lake Charles, La. (-35%, -6,800 jobs); Midland; Longview, Texas (-24%, -3,600 jobs) and Greeley, Colo. (-21%, -4,100 jobs).

Only 104, or 29%, out of 358 metro areas added construction jobs during the past 12 months, while construction employment was stagnant in 51 metro areas. Seattle, Bellevue and Everett, Wash., added the most construction jobs over 12 months (5,300 jobs, 5%), followed by Indianapolis, Carmel-Anderson, Ind. (4,300 jobs, 8%); Austin, Round-Rock, Texas (4,000 jobs, 6%); Sacramento, Roseville and Arden-Arcade, Calif. (3,200 jobs, 5%); and Ogden-Clearfield, Utah (3,100 jobs, 15%). Sierra Vista-Douglas, Ariz., had the highest percentage increase (35%, 900 jobs), followed by Fargo, N.D.-Minn. (24%, 1,800 jobs); Cleveland, Tenn. (16%, 300 jobs); Niles-Benton Harbor, Mich. (15%, 300 jobs) and Ogden-Clearfield.

Association officials said that rapidly rising materials prices were squeezing construction firms while they could not charge more for construction projects amid broader market uncertainties caused by the pandemic. They urged federal officials to ease tariffs on key construction materials – including steel and lumber – to address materials prices and to boost investments in infrastructure to increase demand.

“Construction employment is not going to rebound in many parts of the country while firms are struggling to afford the materials they need to complete existing projects,” said Stephen E. Sandherr, the association’s chief executive officer. “Once federal officials take immediate and effective steps to address both spiking prices and lagging demand, employment levels should rebound in more of the country.”