The latest employment statistics from the Bureau of Labor Statistics, released August 3, showed a slight increase in jobs overall, but also an increase in the unemployment rate.
Total non-farm payroll employment edged up by 163,000 jobs in July, but the unemployment rate ticked up slightly, from 8.217% in June to 8.254% in July.
Alan Krueger, chairman of the Council of Economic Advisers, said in a statement that the report provides further evidence “that the U.S. economy is continuing to recover from the worst downturn since the Great Depression.”
But those numbers are giving the construction industry little to cheer about. Construction employment decreased by 1,000 in July, from 5,514,000 seasonally adjusted jobs in June to 5,513,000 jobs in July.
The unemployment rate in the construction industry dropped to 12.3%, the lowest July late in four years. However, that drop is not necessarily a sign of a market recovery, says Ken Simonson, chief economist for the Associated General Contractors.
According to Simonson, the sector’s unemployment rate has steadily declined since 2010, as hundreds of thousands of out-of-work construction workers have left the industry. “Employment levels in the construction industry have remained relatively stagnant since early 2010,” he says. “The declining unemployment rate has more to do with frustrated job seekers leaving the industry than it does any improvement in demand for construction work.”
Associated Builders and Contractors Chief Economist Anirban Basu adds, “the lack of construction employment growth is consistent with the general level of unease felt by many decision makers, including lenders. This heightened level of economic and policy uncertainty has suppressed construction starts, which in turn has constrained hiring.”
Still, Basu says, the numbers are more positive than some had expected, and should ease fears of another near-term recession.
“The U.S. economy remains resilient and is positioned for steady expansion during the next several months. In that case, the expectation is that the number of nonresidential construction jobs would also trend a bit higher in the foreseeable future.”