Date: June 19, 2009
Clearing Confusion About Buy America, Reporting Requirements Could Help Speed Stimulus Funds, Slow Decline in Construction Employment, Top Construction Economist Concludes
The construction employment picture brightened slightly with 18 states adding construction jobs from April to May according to a new analysis of data released today by the Bureau of Labor Statistics (BLS). However, construction employment overall continued to decline, noted Ken Simonson, the chief economist for the Associated General Contractors of America.
"Projects funded by the stimulus legislation probably mitigated the overall downturn in construction jobs in May," Simonson said, noting however that the BLS data do not separately identify 'stimulus' hires. "While the stimulus is starting to help, it is not keeping pace with overall declines in construction activity in most places."
Simonson noted that North Dakota saw the biggest increase in construction employment from April to May, with a 9-percent rise, seasonally adjusted, followed by Mississippi, 4 percent; South Dakota and Indiana, 3 percent each; and West Virginia, Vermont, Wisconsin and Nebraska, 2 percent each. (To prevent disclosure of data for industries with small employment totals, BLS presents construction combined with mining and logging in South Dakota, Nebraska, four other states and the District of Columbia.)
Despite these localized construction gains, however, national construction employment dropped by 59,000 (almost 1 percent), seasonally adjusted, from April to May, Simonson added.
Compared to construction employment this time last year, the current jobs picture is bleaker, Simonson said. For example, Arizona, shed 28 percent of its payroll jobs in construction over the past 12 months.; Kentucky and Connecticut 21 percent each, and Nevada and Tennessee (combined data), 20 percent each. Meanwhile, only North Dakota (4 percent) and South Dakota (3 percent) added construction jobs since last May.
Metro-area data also provided a grim picture over the past 12 months. (Metro figures are not seasonally adjusted and thus are suitable for comparing only to same month in prior years.)
Only nine out of 311 metro areas for which data is available had year-over-year employment gains in construction (or combined sectors), led by Baton Rouge, 7 percent; Grand Junction, Colorado (combined data), 5 percent; Odessa, Texas, and Bismarck, N.D. ( both with combined data), 4 percent; and Decatur, Illinois (combined data), 3 percent. Two metros had no changed in construction (combined data) employment, while 300 had losses. The steepest losses over the past 12 months were in Pascagoula, Miss. (combined data), -40 percent; Redding, Calif. (combined data), -37 percent; Reno-Sparks, Nev., -31 percent; Tucson and Phoenix-Mesa, Scottsdale, both -29 percent.
"Whether more states and metros join the 'win column' in adding construction jobs depends largely on how quickly all levels of government turn stimulus money into contracts," Simonson said. "Local governments must avoid imposing their own Buy American standards, states must work promptly to hold bid lettings, and federal agencies need to clarify reporting requirements and rules."
Simonson noted that getting more stimulus money flowing will help companies like San Angelo, Texas-based Reece Albert Inc. which has been able to save 20 jobs to date because of stimulus funded highway work. And given the likelihood of continued declines in privately-funded construction, getting stimulus funds flowing for non-transportation projects will help companies like Gorham, Maine-based R.J. Grondin & Sons pick up more water main and other construction work.