Construction employment increased by 84,000 jobs in October, in both nonresidential and residential categories, according to an analysis by the Associated General Contractors of America of recently released government data. Association officials cautioned, however, that the pandemic is causing a growing number of construction projects to be canceled or delayed, according to a survey the association released in late October.

“The employment data for October is good news, but our latest survey found that only a minority of contractors expect to add to their workforce in the next 12 months,” says Ken Simonson, the association’s chief economist. “As project cancellations mount, so too will job losses on the nonresidential side unless the federal government provides funding for infrastructure and relief for contractors.”

Construction employment climbed to 7,345,000 in October, an increase of 1.2% compared to September. However, employment in the sector is down by 294,000, or 3.9%, since the most recent peak in February, just before the pandemic triggered widespread project cancellations. Despite the employment pickup in October, nonresidential construction employment—comprising nonresidential building, specialty trades and heavy and civil engineering construction—remains 262,000 jobs, or 5.6%, below its recent peak in February, Simonson notes.

The construction economist adds that residential construction, covering residential building and specialty trade contractors, has had a stronger recovery, with employment down by just 32,000 jobs, or 1.1%, since February. The industry’s unemployment rate in October was 6.8%, with 674,000 former construction workers idled. These figures were the lowest since the pandemic struck but considerably higher than the October 2019 figures of 4% and 398,000 workers, respectively, the economist adds.

In the association’s October survey, which covered more than 1,000 contractors that perform all types of nonresidential and multifamily construction, three out of four respondents reported that a scheduled project had been postponed or canceled. Only 37% of respondents expect their headcount to increase over the next 12 months. That was a sharp drop from the 75% who predicted an increase in the association’s annual “Hiring and Business Outlook Survey,” released last December.

Association officials say they were encouraged by reports that Congress plans to consider new coronavirus relief measures before the end of the year. They noted that new measures, including investments in infrastructure, new Paycheck Protection Program flexibility and tax relief, and liability reforms will help offset the impacts of the growing number of project cancellations and delays.

“Congressional leaders understand that employers cannot afford to wait until next year for relief from the broad economic impacts of the coronavirus pandemic,” says Stephen E. Sandherr, the association’s chief executive officer. “We stand ready to work with Congress to make sure any new relief measures include new infrastructure investments, tax relief and liability reform so honest firms don’t fall victim to predatory lawyers seeking to profit from the coronavirus.”

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