Construction employment declined between April 2010 and April 2011 in 179 out of 337 metropolitan areas (including divisions of larger metros) for which the Bureau of Labor Statistics provides data, increased in 114 and stayed level in 44, according to an analysis AGC released on Thursday. In March, 151 metros lost construction jobs compared with 12 months earlier, added jobs and 52 had the same number. Metro data are not seasonally adjusted and usually combine mining and logging with construction to avoid disclosing information about industries with few employers. The Dallas-Plano-Irving division again added more construction jobs (7,400 combined jobs, 7%) than any other area during the past year while Grand Forks, North Dakota-Minnesota, added the highest percentage (18%, 400 combined jobs). Other areas adding a large number of jobs included the Fort Worth-Arlington, Texas division (2,900 combined jobs, 5%); Beaumont-Port Arthur, Texas (2,300 combined jobs, 13%); Columbus, Ohio (2,200 combined jobs, 8%); and the Chicago-Joliet-Naperville division (2,000 construction jobs, 2%). The largest job losses were in New York City (-9,300 jobs, -8%); followed by Las Vegas (-7,500 construction jobs, -16%); Atlanta-Sandy Springs-Marietta (-7,300 construction jobs, -8%); and Denver-Aurora-Broomfield (-5,400 combined jobs, -8%). Steubenville-Weirton, Ohio-West Virginia (-25%, -500 combined jobs) lost the highest percentage, followed by Lewiston, Idaho-Washington (-18%, -200 construction jobs); and Bend, Oregon (-18%, -600 combined jobs).
“Preliminary tax collection data for the January-March quarter of 2011 show strong growth in overall state tax collections,” the Rockefeller Institute of Government reported on Tuesday. “However, tax revenue collections are still below peak levels….The Rockefeller Institute's compilation of data from [46] early reporting states shows collections from major tax sources increased by 9.1% in nominal terms in the first quarter of 2011 compared to the same quarter of 2010. That represented the third consecutive quarter of increasing strength in revenues. Tax collections now have been rising for five straight quarters, following five quarters of declines, but were still 3.1% lower in early 2011 than in the same period three years ago. Virtually every state reported growth in overall tax collections.” The sole exception was New Hampshire, where revenues were flat; no data was reported for Hawaii, Nevada, New Jersey or New Mexico. So far, revenues have not risen enough in most states to support higher construction spending. In addition, gasoline and other highway tax receipts have not been rising, forcing many states to cut their highway construction budgets. Louisiana and Missouri have said their highway construction spending will drop by 50%.
Property tax receipts, the primary funding source for most school districts and local governments, appear unlikely to turn up for years because receipts depend heavily on house prices, which are still falling. The Federal Housing Finance Agency reported on Wednesday that its house price index (HPI) for homes purchased with Freddie Mac- or Fannie Mae-backed mortgages “was 2.5% lower on a seasonally adjusted basis in the first quarter than in the fourth quarter of 2010….Over the past year, seasonally adjusted prices fell 5.5% from the first quarter of 2010 to the first quarter of 2011…. The seasonally adjusted purchase-only HPI declined in the first quarter in 43 states” and D.C. The only states with year-over-year increases were Alaska, 2.7%; West Virginia, 2.2%; and North Dakota, 1.1%. The largest declines occurred in Florida, -9.9%; Georgia, -10.0%; Oregon, -10.3%; Arizona, -12.2%; and Idaho, -15.75. Among the 25 most populated metropolitan areas, four-quarter price declines were greatest in the Atlanta-Sandy Springs-Marietta area, -13.5%. Prices held up best in Pittsburgh, rising 0.2%. Among all 309 ranked metros, price changes ranged from gains of 4.3% in Bismarck, N.D.; 3.9% in Owensboro, Kentucky; and 3.8% in Kokomo, Indiana; to -12.7% in Deltona-Daytona Beach-Ormond Beach, Fla.; and -15.2% in Boise City-Nampa, Idaho. Even after prices turn up, receipts do not follow immediately, because assessments change with a lag of several quarters.
“Property occupancies continued to improve” among five property types in more than 50 markets in the first quarter, the Dividend Capital Research Real Estate Market Cycle Monitor reported on Wednesday, “but rents only improved in apartments and hotels. New construction declined again, so absorption should rebound more quickly….New [office] construction is at a 20-year low and the two towers at the World Trade Center make up 33% of new office construction. Office absorption was a low five million square feet for the quarter, and just barely above completions. All of the…absorption was in [central business districts] as suburban office submarkets suffered….Industrial occupancies improved 0.4%” in the first quarter and 1.4% year-over-year. “All indicators point to a solid recovery….Net absorption [of apartments, 44,000 units] and the low amount of new supply of less than 0.5% should help to make the recovery move along faster. While some researchers forecast new construction to pick up in 2011, demand is expected to match this new supply….Retail occupancies improved 0.5%” in the quarter and 1.5% year-over-year. “Major national retail chains are seeing enough sales growth that they are expanding and occupancies in regional malls are improving. Hotel revenue per available room increased 2.8% in the quarter and 8.9% year-over. “New construction starts are almost nonexistent as financing is very hard to get for hotels after their major defaults in the recession.”
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