by Bill McBride on 9/05/2011 11:55:00 AM
Monday, September 05, 2011
The graph below shows the number of total construction payroll jobs in the U.S., including both residential and non-residential, since 1969.
Construction employment is down 2.2 million jobs from the peak in April 2006, but up slightly this year (through the August BLS report).
Unfortunately this graph is a combination of both residential and non-residential construction employment. The BLS only started breaking out residential construction employment fairly recently (residential building employees in 1985, and residential specialty trade contractors in 2001).
Click on graph for larger image in graph gallery.
Mostly moving sideways ...
Usually residential investment (and residential construction) lead the economy out of recession, and non-residential construction usually lags the economy. Because this graph is a blend, it masks the usual pickup in residential construction following previous recessions. Of course residential investment didn't lead the economy this time because of the huge overhang of existing housing units.
This table below shows the annual change in construction jobs (total, residential and non-residential) and through August for 2011.
|Annual Change in Payroll jobs (000s)|
|Year||Total Construction Jobs||Residential Construction Jobs||Non-Residential|
|Through August 2011||26||14||12|
After five consecutive years of job losses for residential construction (and four years for total construction), this is a baby step in the right direction. However there will not be a strong increase in residential construction until the excess supply of housing is absorbed.
In addition residential investment has made a positive contribution to GDP so far this year for the first time since 2005. A small contribution - but a positive one.