The continued labor shortage contributed to a decrease in U.S. construction spending in October, reports the Associated General Contractors of America (AGC). Federal spending data shows a decrease of 0.3% in construction spending with downturns throughout most nonresidential categories.

The lack of workers is prolonging projects, states the AGC. Association officials note that contractors struggle to complete projects as the number of open positions at the end of October topped hires in the month.

“Most nonresidential contractors report full order books but are having trouble hiring enough workers to keep projects on schedule,” says Ken Simonson, the association’s chief economist. “Rising interest rates and costs for materials are likely to choke off some projects but there will be plenty of infrastructure, manufacturing plants and renewable energy projects next year — if contractors can find enough workers to build them.”

Construction spending, not adjusted for inflation, totaled $1.795 trillion at a seasonally adjusted annual rate in October, 0.3% below the September rate but 9.2% above the October 2021 rate. Spending on private nonresidential construction fell 0.8% in October, while public construction investment slumped by 0.9%.

Commercial construction, which comprises warehouse, retail, and farm construction, declined by 0.4% and manufacturing construction dipped by 3.3%. In contrast, power construction climbed by 1.5%.

Additionally, construction industry job openings totaled 377,000 at the end of October, which exceeded the 341,000 employees hired during the month, according to government data released on Wednesday.

Association officials say labor shortages remain one of the top concerns for most construction firms.

“You can’t be both for infrastructure and against boosting investments in preparing workers to build that infrastructure,” says AGC CEO Stephen E. Sandherr. “Until federal officials narrow the five-to-one gap in federal funding for college prep versus craft career development, labor shortages will restrain the industry’s ability to rebuild the economy.”