Construction Earnings Increased by 5.3 percent Year-over-Year to $35.21 an Hour as Firms Boost Wages in an Effort to Attract More Workers into the Sector Amid Strong Demand for Certain Types of Projects
The construction industry added 11,000 jobs in January despite bouts of exceptionally cold or stormy weather that delayed projects in numerous regions, according to an analysis of new government data the Associated General Contractors of America released today. Association officials noted that firms are boosting wages and taking other steps to attract more workers as firms try to keep pace with relatively strong demand.
“Although job gains were modest last month, other evidence suggests there is still lots of demand for workers,” said Ken Simonson, the association’s chief economist. “Wages rose faster than in other sectors, job openings at the end of 2023 were at near-record levels for December, and construction spending jumped that month.”
Construction employment in January totaled 8,137,000, seasonally adjusted, an increase of 11,000 or 0.1 percent from the upwardly revised December total. The sector has added 216,000 jobs during the past 12 months, a gain of 2.7 percent. Residential building and specialty trade contractors added 2,700 employees in January and 60,100 (1.8 percent) over 12 months. Employment at nonresidential construction firms—nonresidential building and specialty trade contractors along with heavy and civil engineering construction firms—climbed by 7,600 positions for the month and 155,100 (3.3 percent) since January 2023.
Average hourly earnings for production and nonsupervisory employees in construction—covering most onsite craft workers as well as many office workers—climbed by 5.3 percent over the year to $35.21 per hour. Construction firms in December provided a wage “premium” of nearly 19 percent compared to the average hourly earnings for all private-sector production employees.
Government reports on job openings and construction spending earlier this week show demand for construction workers and projects remains robust, the economist said. Job openings in construction at the end of December totaled 374,000, not seasonally adjusted, greatly exceeding the 227,000 workers hired and implying that contractors want to hire far more workers than they are able to find, Simonson said. In addition, spending on projects under way that month totaled $2.1 trillion at a seasonally adjusted annual rate, 0.9 percent higher than in November and 14 percent higher than a year earlier.
Association officials noted that too few workers are choosing to pursue careers in construction, despite the sector’s high wages. One reason for that is the paucity of construction education and training programs, particularly at the high school level. They urged federal officials to boost funding for construction education and training programs. They also called for allowing more people to lawfully enter the country to work in construction.
“Considering most construction positions don’t require a college degree, construction careers offer an almost certain path to economic security,” said Stephen E. Sandherr, the association’s chief executive officer. “Yet too few workers are ever exposed to the many career opportunities available to them in construction as policy makers continue to urge everyone to go to college instead.”
View the construction employment data.