Construction Adds Only 1,000 Employees in October as Firms Struggle to Find More Workers to Hire Amid Tight Labor Conditions for the Sector

The construction industry added only 1,000 employees in October while it continued to boost wages for hourly workers as firms compete to hire from a small labor pool, according to an analysis by the Associated General Contractors of America of new government data. Association officials said the small increase in construction employment is an indication of how hard it has become for construction firms to find qualified workers to hire.

“The construction sector would likely have added more jobs in October if only firms could find people to bring on board,” said Stephen E. Sandherr, the association’s chief executive officer. “Labor market conditions are so tight, however, that the sector barely increased in size even as demand remains strong for many types of construction projects.”

Total construction employment moved up by a mere 1,000 employees to 7,721,000 in October, an increase of 266,000 or 3.6 percent from a year earlier. Nonresidential building firms added 3,200 employees for the month, while residential building firms added 3,200. Those gains, however, were offset job losses among specialty trade contractors (-4,000 jobs) and heavy and civil construction firms (-400).

Pay levels in the construction industry continued to increase in October. The average hourly earnings in construction went from $33.41 in October 2021 to $35.27 last month, an increase of 5.6 percent, higher that than the 4.7 percent increase in total private sector earnings for the year. Average weekly earnings in the sector also increased from $1,296.31 in October 2021 to $1,372.00 last month.

The unemployment rate among jobseekers with construction experience increased slightly from 4.0 percent in October 2021 to 4.1 percent last month. The number of unemployed construction workers went from 398,000 in October 2021 to 419,000 in October of 2022, a slight increase, but still a small pool of available workers given the overall size of the industry, Sandherr noted.

Association officials urged the Biden administration and Congress to take steps to address construction workforce shortages. This includes allowing more people to lawfully enter the country who have construction experience to provide short-term relief. At the same time, they continued to urge leaders to address a funding gap that puts $5 federal dollars into college-focused education programs for every dollar invested in career and technical education.

“Washington officials are making historic investments in infrastructure, manufacturing and the energy sector,” said Sandherr. “But as much as they want to see new things getting built, they have not been willing to invest in ways to encourage more people to do all that construction.”