Construction shed 3,000 jobs in October, but nonresidential contractors kept hiring

On paper, October was construction's first losing month since February. The Bureau of Labor Statistics jobs report, published on 6 November, put the industry down 3,000 jobs while total nonfarm payrolls rose 165,000 and the national unemployment rate sat at 4.1%. Associated Builders and Contractors' read of the same data splits that small drop into two very different halves.

Two industries in one number

Nonresidential construction added 13,300 jobs in October, with growth in all three of its parts. Nonresidential specialty trade contractors (the electrical, mechanical, plumbing and other subs) added 7,900. Nonresidential building contractors added 2,900, and heavy and civil engineering firms added 2,500.

Housing went the other way. The Associated General Contractors of America counted 16,400 jobs lost across residential builders and subcontractors combined. ENR's breakdown shows almost all of that came from residential specialty trades, down 15,200, with residential building contractors down 1,200.

"The construction industry lost jobs for the first time since February," said Anirban Basu, chief economist at ABC, before adding that the losses were entirely on the residential side.

The 12-month view

Over the year, construction is still up 124,000 jobs, or 1.5%, according to ABC. AGC's figures show where that growth sits: nonresidential employment is up 164,600 (3.3%) while residential is down 40,200 (1.2%). Total construction employment stood at 8,367,000 in October. For comparison, AGC notes that nonfarm payrolls across the whole economy grew 0.6% over the same period.

ABC put construction unemployment at 3.6%, below the 4.1% rate for all industries.

What contractors expect next

ABC's Construction Confidence Index suggests the nonresidential side isn't done hiring. Nearly 50% of contractors expect to add staff over the next six months, and fewer than 12% expect to cut. Basu linked the continued nonresidential gains to the ongoing data centre boom.

AGC chief executive Jeffrey D. Shoaf was blunter about the constraint. "Contractors are eager to hire more workers," he said, calling for more training opportunities, immigration reform and continued highway and transit funding.

Why this matters for TA

A flat national number hides a lot of movement. Residential trades are losing jobs month after month, while commercial, industrial and civil contractors are still competing for the same pool of electricians, pipefitters, supervisors and project managers. Some of the people leaving housing will have skills that transfer, and some won't. Either way, the hiring pressure in nonresidential work hasn't eased, and the headline figure shouldn't be read as a sign that it has.