Imports of goods rose 16% in the first four months of 2005 compared to the same period of 2004, the Commerce Deparment reported today. Imports of stone, sand, cement, etc. jumped 29%, reflecting record levels of construction and slow growth of domestic production. Last Friday, AGC CEO Steve Sandherr wrote to Commerce Secretary Carlos Gutierrez to warn that AGC had heard of shortages in 10 states, some of which had adequate supplies last year, and to seek relief from an anti-dumping duty that has discouraged imports of Mexican cement. Media reports triggered by that letter have documented shortages in many areas. On the same day, the Portland Cement Assn. (PCA) issued a survey that indicated 23 states had “tight conditions” or localized “spot tightness” (www.cement.org). PCA Chief Economist Ed Sullivan warned, “Market tightness may spread. Fragile market balances prevail in several other areas currently not characterized by tight supplies. Harsh weather conditions earlier in the year depressed construction activity and enabled cement companies to build inventories, staving off current tight supply conditions. As weather conditions improve, the release of pent-up construction demand could further tighten supplies in some regional markets. This is particularly evident for West Coast markets,” where PCA did not find tight conditions. In contrast, AGC received multiple reports of shortages in central and eastern Washington, as well as southern Oregon.
The Bureau of Labor Statistics (BLS) reported on Tuesday that the construction industry's job openings rate tumbled from 2.3% in March, seasonally adjusted, to 1.5% in April, a tad below the April 2004 rate of 1.6%. The rate equals the number of openings at the end of the month divided by employment for the month plus openings. The construction rate was well below the economy-wide rate, which rose from 2.6% in March to 2.7% in April. Despite the low number of openings, construction consistently had a hire rate well above the overall rate, 6% vs. 3.4% in April. This would seem to suggest that contractors are able to fill jobs more rapidly than most employers, hiring many but having relatively few unfilled positions.