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News Oct. 7, 2020

Construction employment adds jobs in September

Construction employment increased by 26,000 jobs in September, according to www.abc.org. During the past five months, the industry has added 689,000 jobs, recovering about 64% of the industrywide jobs lost since the start of the COVID-19 pandemic.

The construction unemployment rate fell from 7.6% in August to 7.1% in September—an increase of 3.9 percentage points compared with the same time last year but a decrease of 0.5 percentage points compared with August. The national unemployment rate for all industries fell from 8.4% in August to 7.9% in September as the U.S. economy added 661,000 jobs.

Nonresidential construction employment added 4,000 jobs on net in September, and there were job gains in two of the three nonresidential segments; the heavy and civil engineering subsector decreased by 3,400 jobs.

“The economic recovery that began in May is losing momentum, as Congress has failed to pass another stimulus bill to offset the continued impacts of the pandemic on travel, tourism, energy production and many other industries,” said Associated Builders and Contractors Chief Economist Anirban Basu. “With many states still suffering high positivity rates and the economy not fully reopening, combined with the uncertainties of an especially contentious presidential election, elevated financial market volatility and looming winter weather, the near-term outlook will continue to deteriorate absent further stimulus.

“While nonresidential construction employment expanded in September as some projects that had been postponed or interrupted came back to life, the number of jobs gained was rather unimpressive,” Basu continued. “In May and June, nonresidential construction added more than 228,000 and 76,000 jobs on net, respectively. But commercial real estate conditions are poor, credit conditions have tightened and state and local government finances have been undermined. Developers and others continue to contemplate the longer-term implications of corporate bankruptcies, recent layoff announcements, remote work and the possibility of a second recession.”

Basu said a stimulus package that addresses infrastructure could make a difference.

“Anecdotal information suggests that bidding opportunities are becoming scarcer and competition for new projects fiercer, as indicated by ABC’s Construction Backlog Indicator,” said Basu. “Although a significant stimulus package—especially with a substantial infrastructure component—could offset construction employment decline during the winter months.”

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