Construction employment added 36,000 jobs on net in May, according to www.abc.org. On a year-over-year basis, the industry has expanded by 283,000 jobs—an increase of 3.8%.
The construction unemployment rate fell from 4.6% in April to 3.8% in May. The national unemployment rate for all industries was unchanged at 3.6% in May as the U.S. economy added 390,000 jobs.
Nonresidential construction added 19,400 jobs in May, with all three sectors showing growth. Heavy and civil engineering added 11,300 jobs; nonresidential specialty trade contractors added 5,700 jobs; and nonresidential building added 2,400 jobs.
“If we look at a single data point, it appears that the nation is entering a period of slower job growth,” said Associated Builders and Contractors Chief Economist Anirban Basu. “Today’s estimate reveals job growth has finally fallen below the threshold of 400,000 new jobs a month. It is unclear whether this is primarily due to a lack of workers available to fill open positions or employers balking at high and rising wages. In either case, the implication is that consumer spending power will not expand as rapidly in the months ahead, setting the stage for softer economic growth and eventually slower inflation.
“In economics, it is often the case that bad news is good news and vice versa,” Basu continued. “Many will view today’s somewhat weaker jobs report as bad news, but for contractors, this may turn out to be highly positive. To the extent that the economy slows, the Federal Reserve may decide not to raise interest rates as aggressively, at least once the summer is past. That will help moderate increases in the cost of capital, contributing to ongoing demand for construction services, which has slipped in the most recent month, according to ABC’s Construction Confidence Index.”