Construction lags in BLS state employment, hiring data; Manpower sees rosier outlook

Seasonally adjusted payroll employment increased in January in 31 states and the District of Columbia, decreased in 18 states and remained unchanged in Idaho, the Bureau of Labor Statistics (BLS) reported on Wednesday. Compared to January 2009, employment fell everywhere except in Alaska (1,900 jobs or 0.6%), North Dakota (1,300 jobs or 0.4%) and D.C. (500 jobs or 0.1%). Seasonally adjusted construction employment rose from December in 18 states plus D.C., fell in 30 and was unchanged in South Dakota. However, unseasonable weather in November through January may have distorted normal employment patterns. Compared to a year earlier, construction employment fell everywhere. The smallest 12-month percentage losses were in North Dakota, -1%; Nebraska and Alaska, -4% each; South Dakota and Arkansas, -6% each. The largest losses were in Nevada, -30%; Arizona, -26%; Colorado, -22%; Idaho, -21%; and Florida, -20%. (BLS combines mining and logging with construction in reporting data for Delaware, D.C., Hawaii, Maryland, Nebraska, South Dakota and Tennessee.) BLS also revised prior-year data "in accordance with annual practices." "The job openings rate rose over the month to 2.1%, the highest the rate has been since February 2009," BLS reported on Tuesday. "The hires rate (3.1%) and the separations rate (3.2%) were unchanged in January." The job openings rate in construction, seasonally adjusted, slipped from 1.2 per 100 employees in December to 1.1 in January, although that was more than double the 0.5% rate in January 2009. Hires fell from 5.9% to 5.8%; separations rose from 6.7% to 7.3%. Manpower Inc. reported on Tuesday that, based on a survey of 18,000 U.S. employers, in the second quarter, "employers expect a relatively stable hiring rate" compared to the first quarter of 2010. The second quarter "Net Employment Outlook for the U.S. is favorable compared to one year ago at this time." Among construction employers, 18% expect to increase hiring, 14% to decrease, for a net employment outlook of +4. Construction had the biggest increase among 13 sectors in net employment outlook, rising from -12 in the first quarter. However, sectoral results are not seasonally adjusted, and the net outlook for construction typically increases from the first to the second quarter. Employer costs for employee compensation in the private sector averaged $27.42 per hour in the fourth quarter of 2009, BLS reported on Wednesday, with $19.41 (70%) paid as wages and $8.00 as benefits. Total costs in construction averaged $31.23 (14% higher than the all-private average), including $21.67 (69%) for wages and $9.56 in benefits. The distribution of benefits was quite different between construction and the private sector as a whole. Costs included legally required benefits (social security, Medicare, unemployment and worker's compensation) totaling $3.47 for construction vs. $2.25 overall, health insurance of $2.14 vs. $2.01, retirement and savings of $1.60 vs. 92 cents, paid leave of $1.14 vs. $1.86, and supplemental pay of $1.06 vs. 82 cents. There have been numerous price increase announcements for construction materials recently. Gerdau Ameristeel announced on Tuesday that it was raising prices for reinforcing bar products $25 per ton immediately and an additional $50 per ton on April 1. The Energy Information Administration (EIA) reported on March 8 that the national average retail price of on-highway diesel fuel rose to $2.90, the highest level since November 2008 and 86 cents (42%) higher than a year ago. "Projected annual average retail diesel fuel prices are $2.96 and $3.14 per gallon, respectively, in 2010 and 2011," EIA said in its Short-Term Energy Outlook released on Tuesday. The New Mexico Department of Transportation (DOT) announced on Wednesday that its index for liquid asphalt for April would be $650, up $14 from March and up $107 (20%) from April 2009. The Illinois DOT announced on March 2 that its index for bituminous (liquid asphalt) for March 1 was $517.50, the fifth straight monthly increase, 42% above the low of November 1. One contractor sent AGC a list of price increases it had received that were due to take effect between today and April 5 for steel, copper and brass items and ranging from 6% to 15%. New orders from U.S. manufacturers (excluding semiconductor manufacturers) climbed 1.7%, seasonally adjusted, in January, the ninth increase in 10 months, the Census Bureau reported on March 4. Orders were 8.8% higher than a year earlier. Orders for construction materials and supplies slipped 0.4% for both the 1- and 12-month periods. Orders for construction machinery, which are typically volatile, soared 5.4% and 40%. Retail sales increased 0.3%, seasonally adjusted, in February and 4.4% from 12 months before, Census reported on Friday. The gains are affecting retailers' construction plans unevenly. The Wall Street Journal reported on Wednesday, "J. Crew will open 15 new stores this year and expects to be 'much more ambitious' about store growth in 2011," Chief Executive Mickey Drexler said. But "one would-be competitor dropped out Tuesday. American Eagle Outfitters Inc. announced that it has decided to close its long-struggling" 28-store Martin + Osa chain. Quarterly revenue of architectural and related services employer firms slipped 0.8%, not seasonally adjusted, in the fourth quarter of 2009 and 23% from the same quarter of 2008, Census reported on Thursday. Revenue of engineering services firms fell 2.3% and 13%.