Construction Adds 22,000 Jobs in December; Jobless Rate Falls To 5%

Construction employment increased by 22,000 jobs between November and December as nonresidential construction firms added workers for the fourth month in a row while residential construction employment slipped, according to an analysis by the Associated General Contractors of America of government data. Association officials said the new employment figures are consistent with the results of a new outlook survey they will be releasing on January 12.

“Nonresidential contractors are increasingly busy and are eager to hire even more workers,” said Ken Simonson, the association’s chief economist. “But the low rate of unemployment and record job openings in construction show how difficult it is bringing enough workers on board.”

Simonson noted that the unemployment rate among former construction workers in December was 5%, which tied the lowest December rate since at least 2000 and was down from 9.6% a year earlier. He added that industry job openings totaled 345,000 at the end of November, an all-time high for November data.

Construction employment in December totaled 7,560,000, an increase of 22,000 for the month and 160,000 or 2.2% for the year. However, industry employment still trails the pre-pandemic peak, set in February 2020, by 88,000 positions.

Nonresidential construction firms added 27,000 employees in December, following a pickup of 25,700 in November. The category comprises nonresidential building contractors, with a gain of 3,700 employees; specialty trade contractors, with 12,900 more workers than in November; and heavy and civil engineering construction, which added 10,400 employees. But nonresidential employment remains 169,000 below the February 2020 level. The sector has regained only 74% of the jobs lost at the outset of the pandemic.

Association officials said the jobs figures reflect the industry optimism indicated in the annual Outlook survey they will be releasing during a virtual media briefing on Wednesday, January 12. But they cautioned that labor shortages continue to challenge contractors who are struggling to hire enough workers to keep pace with demand.

“The industry appears well poised for a strong recovery in 2022, but there are certainly clear challenges, including labor shortages, that could undermine construction this year,” said Stephen E. Sandherr, the association’s chief executive officer.