The Building Tradesman Newspaper

Friday, July 06, 2012

There’s also no momentum in Michigan

By The Building Tradesman

The ongoing lack of strength in the national construction industry is mirrored by Michigan numbers, as construction employment declined in 164 out of 337 U.S. metropolitan areas between May 2011 and May 2012, increased in 126 and stayed stagnant in 47, according to a new analysis of federal employment data released June 26 by the Associated General Contractors of America.

Association officials said that construction employment has suffered as Congress has debated a replacement for a highway and transit bill that expired over three years ago, causing infrastructure and economic measures to languish. A Congressional conference committee finally came up with a deal for a 27-month funding plan on June 27, providing hope that the rest of Congress will adopt it.

“The number of metro areas losing construction jobs continues to increase compared to earlier this year,” said Ken Simonson, the association’s chief economist. “Considering the ongoing cuts to public construction budgets, there just isn’t enough construction activity in many areas to sustain the same employment levels as last year.”

Last summer, construction activity in a number of Michigan markets was surprisingly strong compared to the rest of the country – in an historically soft market. This year, not so much. Only the Warren- Troy- Farmington region (#37) ranked among the top 100 U.S. metropolitan areas from May 2011 to May 2012. Checking in near the bottom were Lansing- East Lansing (#311), Kalamazoo-Portage (#324) and Monroe (#336). Otherwise, most regions in Michigan were in the middle of the pack when it came to construction activity.

Overall, during the May 2011 to May 2012 period, Michigan lost 4,300 construction jobs, or 3 percent of its workforce.

The largest job losses during the period were in Tampa-St. Petersburg-Clearwater, Fla. (-7,100 jobs, -14 percent); followed by Chicago-Joliet-Naperville, Ill. (-6,900 jobs, -6 percent); New York City (-5,100 jobs, -5 percent).

Bakersfield-Delano, Calif. added the highest percentage of new construction jobs (22 percent, 3,000 jobs) followed by Indianapolis-Carmel, Ind. (20 percent, 8,000 jobs) and Knoxville, Tenn. (19 percent, 3,100 jobs).

“While there are many factors contributing to the ongoing construction employment losses, the lack of a highway and transit bill is certainly not helping,” said the association’s chief executive officer, Stephen E. Sandherr. “Passing a bill soon will save a lot of construction jobs and help the industry hang on until private sector demand heats up and state and local budgets get stronger.”