Last Friday's January Employment Situation report from the Bureau of Labor Statistics was a good one; total payroll employment increased by 225,000, but probably no one was happier about it than the National Association of Home Builders (NAHB). The report was an excellent one when it comes to hopes for resolving one of the constraints NAHB seems as hurting its members; a shortage of construction workers.
Residential construction employment rose by 20,200 in January. According to Jing Fu, writing in NAHB's Eye on Housing blog, this was the largest gain in the last 12 months. The total January increase in construction jobs, residential and nonresidential was 44,000.
The number of residential specialty trade contractors increased by 17,800 in January. This represented most of the gain in residential construction employment.
In December NAHB asked home builders, as part of its monthly NAHB/Wells Fargo Housing Market Index survey, to list the biggest problems they encountered in 2019 and those they expect to encounter this year. The cost and availability of labor topped the survey in both instances. Eighty-seven percent named it as their number one problem last year and 85 percent expected it to be so this year. This far outdistanced the second most mentioned problem; building materials, named by 66 percent, unchanged from year to year.
Residential construction employment totaled 2.9 million in January. This breaks down to 831,000 builders and 2.1 million residential specialty trade contractors. Total employment in the construction sector, residential and nonresidential, is about 7.6 million.
NAHB says the 6-month moving average of residential construction job gains is 5,767 a month. Over the last 12 months, home builders and remodelers added 43,800 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 959,100 positions.
The national unemployment rate ticked up 0.1 percentage point in January to 3.6 percent while the unemployment rate for construction workers remained unchanged at 4.5 percent on a seasonally adjusted basis. The unemployment rate for the construction sector has been trending downwards since February 2010 and remains historically low.