After four months of rising construction job totals, the industry shed 5,000 positions in January, as losses in the heavy-civil sector outweighed gains in other categories, the federal Bureau of Labor Statistics reported.

The new BLS monthly report, released Feb. 4, also shows that construction’s unemployment rate climbed to 7.1% from December’s 5%, but was much improved from the year-earlier 9.4%.

Among construction sectors, heavy and civil engineering construction—which reflects infrastructure work—lost 9,500 jobs in January, outpacing increases in every other segment of the industry.

Residential building posted the best job results for the month, adding 3,600. Nonresidential building, nonresidential specialty trade contractors and residential specialty trade contractors all were up, but the increases were small—fewer than 1,000 in each segment.

Architectural and engineering services, a separate BLS category, gained 8,000 jobs in January.

Construction’s total employment has risen by 163,000, or 2.2%, since January 2021, but it still lags the pre-pandemic peak of 7,624,000 recorded for February 2020.

The BLS unemployment rates are not adjusted for seasonal variations, but the job gains or losses are seasonally adjusted.

Anirban Basu, Associated Builders and Contractors' chief economist, suggests several possible reasons for the January results. Regarding the job losses in heavy-civil construction, Basu said in a statement that “it may be that some purchasers of public construction services have shifted into planning and engineering mode to figure out how incoming infrastructure dollars can and should be spent.”

In recent weeks, federal agencies have been rolling out some of the billions of dollars for public works projects contained in the massive Infrastructure Investment and Jobs Act, which was signed into law on Nov. 15.

Basu also says that sharp cost hikes may have prompted public and private project owners to postpone planned work.

Ken Simonson, Associated General Contractors of America chief economist, said in a statement, “Contractors are struggling to fill positions as potential workers opt out of the labor market or choose other industries.” Simonson added that “soaring materials costs and unpredictable delivery times are delaying projects and holding back employment gains.”

AGC noted that January's decline in construction jobs occurred while the industry's average hourly pay increased “at a record pace” in the past year. Simonson said construction hourly earnings rose 5.1% from January 2021 to January 2022, the sharpest 12-month gain since the BLS data series began 15 years ago.

He added that the construction hourly average of $33.80 per hour was 7% above the private-sector average.

Overall, the economy added 467,000 jobs in January, compared with an average monthly gain in 2021 of 555,000. The nation’s jobless rate edged up to 4%, from December’s 3.9%.