Plumbing and Mechanical

Half of metro areas add construction jobs

March 27, 2012
Half of metros add construction jobs; starts drop, MHC says; ABI stays barely favorable

Construction employment increased in 169 (50.1%) out of 337 metropolitan areas (including divisions of 11 large metros) between January 2011 and January 2012, decreased in 111 and stayed level in 57, according to a March 20 Associated General Contractors of America analysis of Bureau of Labor Statistics data. That was the first time since 2007 that a majority of metro areas had year-over-year construction employment gains. (BLS does not seasonally adjust metro data. The agency combines mining and logging with construction for many metros to avoid disclosing data about industries with few employers.)

Atlantic City-Hammonton, N.J. added the highest percentage of new construction jobs (45%, 1,700 combined jobs), followed by Bakersfield-Delano, Calif. (31%, 4,000 construction jobs). Portland-Vancouver-Hillsboro, Ore.-Wash. added the most jobs (5,300 construction jobs, 13%), followed by Denver-Aurora-Broomfield, Colo. (5,000 combined jobs, 8%); Atlanta-Sandy Springs-Marietta, Ga. (5,000 construction jobs, 6%); and Indianapolis-Carmel, Ind. (4,600 construction jobs, 14%).

The largest job losses were in Tampa-St. Petersburg-Clearwater, Fla. (-7,100 construction jobs, -14%), followed by the Chicago-Joliet-Naperville, Ill. division (-5,200 construction jobs, -5%). Springfield, Mass.-Conn. (-23%, -1,800 combined jobs) lost the highest percentage, followed by Anniston-Oxford, Ala. (-20%, -200 combined jobs) and Oshkosh-Neenah, Wis. (-19%, -600 combined jobs).

Click here to view January metro construction employment numbers.

New construction

New construction starts declined 7% from January to February at a seasonally adjusted annual rate, McGraw-Hill Construction reported March 20, based on data it collected. “The nonbuilding construction sector, comprised of public works and electric utilities, lost considerable momentum in February, and diminished activity was also reported for nonresidential building. Meanwhile, residential building in February was able to register modest growth. For the first two months of 2011, total construction starts on an unadjusted basis [were] down 14% from a year ago. For the 12 months ending February 2012 vs. the 12 months ending February 2011, which lessens the volatility present in year-to-date comparisons of just two months, total construction starts were down 2%.”

MHC Vice President of Economic Affairs Robert Murray stated, “Renewed expansion for the construction industry is still struggling to take hold, with gains for a few project types such as multifamily housing being outweighed by declines for project types that are largely publicly financed. This was especially the case in February, when much of the downward pull came from weakness for public works and institutional building.”

“Led by the commercial sector, the Architecture Billings Index has remained in positive territory four months in a row,” the American Institute of Architects reported March 21. The February ABI score was 51.0, essentially unchanged from the previous three months. The index measures the difference between the percentage of architects who say billings rose less and those who say billings declined in the previous month, with 50 being a neutral score.

“‘This is more good news for the design and construction industry that continues to see improving business conditions,’ said AIA Chief Economist Kermit Baker. … ‘The factors that are preventing a more accelerated recovery are persistent caution from clients to move ahead with new projects, and a continued difficulty in accessing financing for projects that developers have decided to pursue.’”

Three of the four practice specialty subindexes, which are based on three-month moving averages of responses from the 700 survey participants, remained positive: commercial/industrial (55.1), multifamily residential (53.3), and institutional (50.3); mixed practice (46.3) was the exception.

Green jobs

“In 2010, 3.1 million jobs in the United States were associated with the production of green goods and services [GGS],” the BLS reported March 22. GGS jobs “are found in businesses that produce goods and provide services that benefit the environment or conserve natural resources. GGS jobs accounted for 2.4% of total employment in 2010. The private sector had 2.3 million GGS jobs and the public sector had 860,300….Construction had 372,100 GGS jobs [second among industries after manufacturing], comprising 6.8% of construction employment [second highest share of industry employment after utilities].

“Among the GGS activities performed within this industry are the construction of plants that produce energy from renewable sources, and weatherizing and retrofitting projects that reduce household energy consumption … .

“The BLS green jobs definition contains two components, an output-based approach and a process-based approach. Output-based jobs are jobs associated with producing goods or providing services that benefit the environment or conserve natural resources. Process-based jobs are jobs in which workers’ duties involve making their establishment’s production processes more environmentally friendly or use fewer natural resources. This news release covers the output approach only. The process approach data will be released later this year.”

Click here to view presentations from Textura Economic Luncheon. 

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