Construction Sector Sheds 9,000 Jobs In March As Low Unemployment Rates And High Number Of Job Openings Indicate A Lack Of Workers, Not Demand

Labor Shortages are Making it Harder for Firms to Replace Retiring Workers as Construction Officials Continue to Call for New Construction Education and Training Support and Immigration Reform Measures.

The construction sector shed 9,000 jobs in March, the first decrease since January 2022, even as the sector’s unemployment rate fell and total number of job openings in the sector hit a near-record high, according to an analysis by the Associated General Contractors of America of new government data. Association officials said the industry was struggling to replace aging workers and pushed for new construction training and education support, as well as immigration reform measures to encourage more people into the industry.

“Despite a small dip in headcount, construction firms continued to post a high level of job openings and raised pay more than other industries—two signs they still want to hire more workers,” said Ken Simonson, the association’s chief economist. “But the pool of unemployed, experienced jobseekers keeps shrinking for the construction sector.”

Construction employment in March totaled 7,888,000, seasonally adjusted, a dip of 9,000 or 0.1 percent from the record high in February and the first decrease in 14 months. Nonresidential firms—comprising nonresidential building and specialty trade contractors along with heavy and civil engineering construction firms—shed a statistically insignificant 1,800 employees in March. Employment at residential building and specialty trade contractors slipped by 7,000 or 0.2 percent.

The unemployment rate among jobseekers with construction experienced declined from 6.0 percent in March 2022 to 5.6 percent, the second-lowest March rate in the 23-year history of the data. A separate government report released earlier this week reported that job openings in construction at the end of February totaled 384,000, just shy of the all-time high for February of 388,000.

Average hourly earnings for production and nonsupervisory employees in construction—covering most onsite craft workers as well as many office workers—jumped by 6.6 percent over the year to $33.82 per hour. Construction firms in March provided a wage “premium” of nearly 19 percent compared to the average hourly earnings for all private-sector production employees.

Association officials said federal officials have failed to boost investments in construction education and training even as they have boosted investments in a wide range of construction programs. They urged public officials at all levels to provide more support for construction programs in schools, apprenticeships, and other training programs. And they urged Congress and the Biden administration to allow more workers with construction skills to lawfully enter the country to work in the sector.

“Firms are struggling to fill high-paying construction positions while many schools continue to push students to go to college, amass student debt and hope for an office job,” said Stephen E. Sandherr, the association’s chief executive officer. “Exposing students and other future workers to construction will signal that it should be among the career paths worth considering.”