Construction Job Market Volatility

2022-11-01T21:19:24-05:00

The count of open, unfilled jobs for the overall economy increased in September, rising from 10.3 million open positions to 10.71 million. This represents a small increase from a year ago (10.67 million). This increase occurs despite signs of a slowing economy amidst aggressive monetary policy tightening by the Fed. The hotter than expected labor market data pushed the 10-year Treasury rate back above 4%. Ideally, the count of open, unfilled positions slows to the 8 million range in the coming months as the Fed’s actions cool inflationary pressures for the U.S. economy. However, while higher interest rates are having an impact on the demand-side of the real economy, the ultimate solution for the labor shortage will not be found by slowing demand, but by recruiting, training and retaining skilled workers. The construction labor market saw an increase for job openings in September despite economic activity slowing, particularly for the housing market. The count of open construction jobs increased from 386,000 to 422,000 in September. This is actually higher than the estimate from a year ago (348,000). The labor shortage persists. The construction job openings rate moved higher, increasing to 5.2% in September after 4.8% in August. The data series high rate of 5.5% was recorded in April. The housing market remains underbuilt and requires additional labor, lots and lumber and building materials to add inventory. However, the market is slowing due to higher interest rates. Nonetheless, hiring in the construction sector remained solid at a 4.7% rate in September. The post-virus peak rate of hiring occurred in May 2020 (10.4%) as a post-covid rebound took hold in home building and remodeling. Consistent with slowing of building activity, construction sector layoffs increased to a 2.1% rate in September. In April 2020, the layoff rate was 10.8%. Since that time however, the sector layoff rate has been below 3%, with the exception of February 2021 due to weather effects. The number of layoffs in construction increased to 166,000, compared to 100,000 a year ago. The number of quits in construction in September (152,000) was lower relative to the measure a year ago (188,000). Looking forward, attracting skilled labor will remain a key objective for construction firms in the coming years. However, while a slowing housing market will take some pressure off tight labor markets, the long-term labor challenge will persist beyond an ongoing macro slowdown. Related ‹ More Prospective Buyers Are Actively Searching for a HomeSeptember Private Residential Spending Stays Flat ›Tags: economics, employment, home building, housing, JOLTS

Construction Job Market Volatility2022-11-01T21:19:24-05:00

Job Openings Fall as Economy Slows

2022-10-04T11:33:33-05:00

The count of open, unfilled jobs for the overall economy fell 10% in August, declining from from almost 11.2 million to 10.05 million. The decline for open jobs reflects the beginnings of a labor market retreat as the economy slows due to aggressive tightening of monetary policy by the Fed. While the economy continues to face a critical skilled labor shortage, particularly in sectors like construction, today’s data is an additional argument in favor of the Fed slowing its projected path of increasingly restrictive policy following its November meeting. Higher interest rates are having an impact on the demand-side of the real economy, which will be reflected in inflation data in future months. The ultimate solution for the labor shortage, however, will not be found by slowing demand, but by recruiting, training and retaining skilled workers. The construction labor market is also generally cooling off as economic activity slows in response to tighter monetary policy. However, the August data shows stability concerning the number of open, unfilled jobs in the construction industry. Nonetheless, this trend will likely weaken during the latter part of 2022 due to the policy decisions by the Federal Reserve. The count of open construction jobs ticked higher, rising from 353,000 in July to 407,000 in August. Despite recent slowing housing data, this is actually higher than the estimate from a year ago (362,000). The construction job openings rate moved higher, increasing to 5% in August after 4.4% in July. The data series high rate of 5.5% was recorded in April. The housing market remains underbuilt and requires additional labor, lots and lumber and building materials to add inventory. However, the market is slowing due to higher interest rates. Nonetheless, hiring in the construction sector remained solid at a 4.8% rate in August. The post-virus peak rate of hiring occurred in May 2020 (10.4%) as a rebound took hold in home building and remodeling. Despite slowing of building activity, construction sector layoffs remained low at a 1.6% rate in August. In April 2020, the layoff rate was 10.8%. Since that time however, the sector layoff rate has been below 3%, with the exception of February 2021 due to weather effects. The number of quits in construction in August (229,000) was slightly higher relative to the measure a year ago (189,000). Looking forward, attracting skilled labor will remain a key objective for construction firms in the coming years. However, while a slowing housing market will take some pressure off tight labor markets, the long-term labor challenge will persist beyond an ongoing macro slowdown. Related ‹ August Private Residential Spending Falls for Third Straight MonthTags: economics, employment, home building, housing, JOLTS, labor market

Job Openings Fall as Economy Slows2022-10-04T11:33:33-05:00

Stable Reading for July Construction Job Openings

2022-08-30T10:22:29-05:00

By Robert Dietz on August 30, 2022 • The construction labor market is cooling off as economic activity slows in response to tighter monetary policy. However, the July data shows stability concerning the number of open, unfilled jobs in the construction industry. This trend will likely weaken during the second half of 2022 due to the policy decisions by the Federal Reserve. The count of open construction jobs ticked higher, rising from 353,000 in June to 375,000 in July. Despite recent slowing housing data, this is actually higher than the estimate from a year ago (337,000). The construction job openings rate inched higher, increasing to 4.6% in July after 4.4% in June. The data series high rate of 5.5% was recorded in April. The housing market remains underbuilt and requires additional labor, lots and lumber and building materials to add inventory. However, the market is slowing due to higher interest rates. Nonetheless, hiring in the construction sector increased to a 5% rate in July. The post-virus peak rate of hiring occurred in May 2020 (10.4%) as a rebound took hold in home building and remodeling. Despite slowing of building activity, construction sector layoffs remained low at a 1.9% rate in July. In April 2020, the layoff rate was 10.8%. Since that time however, the sector layoff rate has been below 3%, with the exception of February 2021 due to weather effects. The number of quits in construction in July (193,000) was effectively flat relative to the measure a year ago (190,000). Looking forward, attracting skilled labor will remain a key objective for construction firms in the coming years. However, while a slowing housing market will take some pressure off tight labor markets, the long-term labor challenge will persist beyond an ongoing macro slowdown. Related ‹ Stucco and Vinyl were the Most Common Siding Materials on New Homes in 2021Tags: economics, home building, housing, JOLTS

Stable Reading for July Construction Job Openings2022-08-30T10:22:29-05:00

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