The Building Tradesman Newspaper

Friday, February 07, 2020

News Briefs

By The Building Tradesman

U.S. construction back where it started

Before the 2019 construction year fades from the rear-view mirror, Dodge Data and Analytics reported on Jan. 21 that for the entire year, U.S. construction starts were essentially flat compared to 2018, with spending at $817.6 billion.

A hefty 21 percent drop in U.S. construction starts in December didn't help, although Dodge said the sharp decline was largely a response to big gains posted in November’s utility and manufacturing sectors. Remove those two volatile sectors, Dodge said, and U.S. construction starts only fell 3 percent in December. 

The pullback in December pushed the Dodge Index for U.S. Construction down to 169 (2000=100) compared to the 213 posted in November, and just below the 12-month average of 174.

“Last year (2019) will go down as one of the most volatile years for monthly construction starts due to the lumpy nature of large projects,” stated Richard Branch, Chief Economist of Dodge Data & Analytics. “Looking beyond the influence of these massive projects, it is evident that the uncertainty surrounding trade policy weighed on construction activity last year.”

Dodge's numbers roughly line up with federal Bureau of Labor Statistics report from last month, which said the jobless rate in U.S. construction improved by one tenth of one percent during the course of 2019, while actual employment increased by about 2 percent, with the industry employing 7.55 million workers at year's end.

Michigan trades sees decline in '19

Michigan had its ups and downs during the course of 2019, ultimately seeing its construction workforce drop by 1 percent, or 1,700 workers, according to the Associated General Contractors.

Our state employed 174,600 construction workers in December 2018, and that number fell to 172,900 a year later. That 1 percent loss ranked Michigan No. 39 among the states, one of 16 states to lose jobs during the course of the year. Among the worst states was neighboring Ohio, which lost 4.0 percent of its construction workforce, or 9,000 jobs - the most in the nation - during the course of 2019.

Other states with large job losses include Louisiana (-7,000 jobs, -4.8 percent) and Minnesota (-3,600 jobs, -2.8 percent). Wyoming lost the highest percentage of construction jobs during the past twelve months (-9.5 percent, -2,100 jobs).

Texas added the most construction jobs in 2019 (55,900 jobs, +7.4 percent), followed by California (31,300 jobs, +3.6 percent) and Florida (25,500 jobs, +4.6 percent).

“Construction employment consistently expanded in at least two-thirds of the states throughout 2019, even though contractors reported difficulty in finding qualified workers all year long,” said Ken Simonson, the AGC's chief economist. “As long as they are able to continue finding qualified workers, most firms expect to continue hiring this year.”