The U.S. construction industry added just 1,000 net new jobs in April, staying on the plus-side with the help of a 6,600-job increase in the nonresidential sector, according to analysis by Associated Builders and Contractors (ABC).
Revisions to the previous two months of construction data produced a net decrease of 3,000 jobs, with March’s construction employment estimate raised by 4,000 jobs but February’s downgraded by 7,000 positions, according to the Bureau of Labor Statistics (BLS).
“There has been a significant volume of data indicating that residential construction has been slowing,” says ABC chief economist Anirban Basu. “This may be due in part to growing concerns in various parts of the nation that the multifamily rental market is on its way to being overbuilt.”
Basu adds that since these are April data, the trend can no longer be attributed to meteorological forces.
“There is a conventional notion that residential construction leads commercial construction,” says Basu. “Nonresidential contractors have benefitted from the surge in multifamily residential construction in recent years because developers frequently incorporate retail or other commercial components into their projects. The slowing in residential construction may partially explain the recent softness in nonresidential construction spending. If that softness persists, the pace of nonresidential construction job growth will of course also slow.”
According to BLS’s estimates, residential specialty trade contractors lost 10,900 positions for the month. The heavy and civil engineering sector lost 2,200 positions. Despite this, the nation’s nonresidential construction sector added 6,600 net new jobs in April.
Nonresidential building is up by 25,500 jobs or 3.5 percent on a year-over-year basis. Residential building construction employment expanded by 7,100 jobs in April and is up by 37,500 jobs or 5.4 percent on a year-ago basis.
Nonresidential specialty trade contractors added 5,500 jobs for the month, and employment in that category is up by 76,700 jobs or 3.3 percent from the same time one year ago. Residential specialty trade contractors reduced payrolls by 10,900 in April, but have added 103,300 jobs or 5.9 percent since April 2015.