Construction Employment and Spending Rose in Spring 2018

According to recent analyses, both construction employment and spending rose in spring 2018, indicating labor demand in the industry continues to be high. However, as always, the challenge is finding qualified workers to take on this labor.

On May 30, the Associated General Contractors of America (AGC) released an analysis stating employment increased in 256 out of 358 metro areas between April 2017 and April 2018. Of the remaining 102 metro areas, employment decreased in 63 and went unchanged in 39. In 54 metro areas, the AGC saw new highs.

In terms of spending, the U.S. Census Bureau released numbers on June 1 that show construction spending at a seasonally adjusted annual rate of $1.310 trillion in April, which is a 1.8 percent increase over March’s estimate. This also represents a 7.6 percent increase over April 2017.

Most of the gains in spending came in private construction, which rose in April to a seasonally adjusted annual rate of $1.014 trillion, a 2.8 percent increase over March. Residential construction rose 4.5 percent and nonresidential rose about 0.8 percent. Public construction actually slid about 1.3 percent in April to a seasonally adjusted annual rate of $296.1 billion. In general, as the graph below shows, private construction, not public projects, has driven most construction spending gains.

Construction Spending Chart

Returning to the topic of employment, the most gains in terms of number of jobs between April 2017 and April 2018 came in Texas—the top two metro areas were Dallas-Plano-Irving, Texas, and Houston-The Woodlands-Sugar Land, Texas, according to the AGC. The largest percentage gains were found in Midland, Texas, followed by Merced, Calif.

“However, despite these [positive] signs, further growth in the industry may be stymied by a lack of qualified workers,” said Ken Simonson, AGC chief economist.

Indeed, the AGC states many contractors have stressed how difficult it is to find these workers in the current construction climate. The association stresses the importance of education and training initiatives in the development of the next generation of workers.

“The good news is that the strong economy is driving demand for many types of construction projects,” said Stephen E. Sandherr, AGC CEO.

About the Author

Matt Kraus

Senior Associate Editor
Matt Kraus is Electrical Contractor magazine's senior associate editor. Contact him at matthew.kraus@necanet.org .

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