Construction employment climbed in November; value put in place was flat in October

Nonfarm payroll employment rose just 112,000 in November, seasonally adjusted, the Bureau of Labor Statistics (BLS) reported today. In addition, BLS revised downward the gains earlier estimated for October (from +337,000 to +303,000) and September (from +139,000 to +119,000). Construction employment rose to 7,034,000, the eighth straight record high. In reporting on the employment situation, BLS Commissioner Kathleen Utgoff remarked, “employment in construction edged up in November (11,000). This followed an unusually large job gain in October (65,000) that partially reflected rebuilding and cleanup activity following the four hurricanes that struck the U.S. in August and September. Since its most recent low point in March 2003, construction employment has expanded by 373,000.” Average hourly earnings for all nonfarm private production workers and in construction rose a penny in November, seasonally adjusted. The average for construction was $19.34, up just 1.5% since November 2003 but 22% above the all-industry average.

The value of construction put in place remained essentially unchanged for the third straight month in October, at a seasonally adjusted annual rate of $1.01 trillion, the Census Bureau reported Wednesday. The October number was 7% higher than in October 2003, and the year-to-date total for January-October 2004 was 9% higher than in the same span of 2003. Private residential construction was 11% higher than in the year-ago month and 14% higher on a year-to-date basis; private nonresidential construction improved by 2.5% and 3.3%; and public construction was up by 3.5% and 3.1%. McGraw-Hill Construction, which counts the full value of new construction contracts in their first month, said on Wednesday that contracts rose 4% in October and 9% year-to-date for: new multi-unit housing (-1% for the month, +16% year-to-date), nonresidential building (+11% and +3%), and nonbuilding construction (+11% and 0). However, neither Census nor McGraw-Hill adjusts for price increases, which continue to be significant for construction materials, as indicated by this week's “Beige Book” and Institute for Supply Management (ISM) surveys.

The Beige Book, an informal survey of current business activity in each of the 12 Federal Reserve Districts that was released Wednesday, showed “continued economic growth from mid-October to mid-November, with a number of areas improving. Eleven Districts reported expanding economic activity…only the Cleveland District reported little change….Commercial real estate markets remained weak, with high vacancies and low--even falling--rents. Nevertheless, several Districts noted that levels of excess capacity continued to ebb. Districts reported that nonresidential construction continues to be at low levels. However, leasing activity was up in the Dallas and Richmond Districts. The Atlanta and Minneapolis Districts noted lower commercial vacancy rates, and San Francisco District contacts indicated that office and industrial vacancy rates were edging down. In contrast, the New York District reported weakening in commercial markets, where strong leasing activity was outpaced by an increased availability of space….Continued cost increases for some building materials were reported in the Atlanta, Cleveland, Kansas City, Minneapolis, New York, Richmond and San Francisco Districts. Cement has been in short supply, and prices have risen for both concrete and cement. Steel prices also rose. While construction-related steel shortages eased in the Chicago and San Francisco Districts, there were reports of shortages of specialty steel in several Districts.”

Nonmanufacturing business activity increased in November for the 20th month in a row, according to purchasing executives in a survey ISM released today. Twelve industry groups reported growth, two indicated contraction, and three reported no change from October. About 38% of respondents and 16 out of 17 industry groups reported paying higher prices compared to October. Items important to construction that were reported in short supply included concrete (seventh straight month), roofing shingles, steel products (10th month), and trucking. Price increases were reported for aluminum, asphalt products, concrete, copper cable, diesel fuel, insulation, lumber (also reported down in price), PVC material/conduit, resin-based products, roofing shingles, steel products, and transportation/freight charges, along with many other items. On Wednesday, ISM said that manufacturing purchasing executives also reported both growing activity and higher input prices in November.

Factory orders (excluding semiconductor manufacturing) rose 0.5% in October, seasonally adjusted, after being flat in September and falling in August, Census reported Thursday. For the first 10 months of 2004, orders were 11% higher than in the same period of 2004. The data are not adjusted for price changes. Orders for construction machinery fell 3.2% in October, after increasing 3.5% in September and 15% in August; year-to-date orders were 43% ahead of January-October 2003. Orders for construction materials and supplies climbed 1.1% in October, after dropping 2% in September and rising 3.4% in August; for the year to date, orders were 13% higher than in the same months of 2003.

Did you enjoy this article? Click here to subscribe to Plumbing & Mechanical. 

Recent Articles by Ken Simonson

You must login or register in order to post a comment.



Image Galleries

2014 Truck of the Month

PM has featured so many great plumbing service trucks! See plenty of them here in our Truck Of The Month Archives page. Are you proud of your truck? Go to our Truck of the Month page to find out how your service truck could be chosen!

4/30/15 2:00 pm EDT

Optimizing Variable Flow Pumping for Energy Savings

 This session will help engineers ensure they are able to understand the many control modes that are possible with today’s modern variable speed pumps to maximize their energy savings.    

Plumbing and Mechanical

150 cover

2015 March

The March issue of PM features cover story:  2015 bath and kitchen remodeling trends: Clean, simple design


Table Of Contents Subscribe

Where do you look for new employees?

Where do you look for new employees?
View Results Poll Archive

The Plumbing and Mechanical Store

2015 National Plumbing & HVAC Estimator

Every plumbing and HVAC estimator can use the cost estimates in this practical manual!

More Products

Clear Seas Research

Clear Seas ResearchWith access to over one million professionals and more than 60 industry-specific publications,Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.


Connect to PM on Facebook Connect to PM on Twitter  Watch PM on YouTube    Connect to PM on Linked InGoogle+

Truck of the Month

Truck of the month

Are you proud of how your service truck looks? Do the graphics give people whiplash as they drive by? Have your calls increased because people remember your truck — and your company name? If so, we’d like to see it, too! Click here to find out how your service truck could be chosen as PM's Truck of the Month.