Contractors are optimistic, on balance, regarding the volume of work available in 2019 for nonresidential and multifamily construction, based on the 1,312 responses to a survey that AGC released on Wednesday. Respondents were asked whether the available dollar volume of projects they compete for would be higher or lower than in 2018. For all 13 categories of projects, between 23% and 32% of respondents expect a higher volume, while 11% to 21% expect a lower volume. (The remainder expect the volume to remain about the same.) The difference—the net reading—was clustered in a narrow range of 10% to 17% positive, except for multifamily residential, with a 5% net positive reading. The survey was conducted from November 7 to December 17. Only 2% of respondents expect their firms to reduce headcount in 2019, compared with 79% who expect an increase (up from 75% in 2018). In addition, 78% say they are having a hard time filling salaried or hourly craft positions (same as in 2018) and 68% say it will be as hard or harder to do so in 2019 (down from 82% in 2018). Of 16 issues listed as answers to a question regarding "the biggest concerns to your firm," 30% picked worker shortages as their number-one concern; 10% chose increased competition for projects. One-third of respondents said project costs had been higher than anticipated and 37% said they have put higher prices into bids or contractors. Similarly, 34% said projects had taken longer than anticipated and 18% said they had put longer completion times into bids or contracts. The survey was sponsored by software firm Sage and included several questions about use of information technology, among other topics. AGC and Sage will present survey results in a free webinar on January 22.
Nonfarm payroll employment in December increased by 312,000, seasonally adjusted, from November and by 2,638,000 (1.8%) year-over-year (y/y) in all of 2018, the Bureau of Labor Statistics (BLS) reported today. The unemployment rate, 3.9%, increased slightly from November (3.7%) but decreased slightly from December 2017 (4.1%). Construction employment increased by 38,000 for the month and 280,000 (4.0%) y/y to 7,352,000, the highest total since March 2008. Average hourly earnings in construction increased 3.9% y/y to $30.44, or 10.8% higher than the average for all private-sector employees ($27.48, a rise of 3.2% y/y). The unemployment rate in construction, not seasonally adjusted, fell to 5.1% (from 5.9% in December 2017), and the number of unemployed jobseekers with construction experience declined to 493,000 (down from 554,000). These were the lowest December figures in the 19-year history of both series. (Not-seasonally-adjusted data may be affected by normal weather and holiday patterns and thus should not be compared to levels in other months.) Architectural and engineering services employment increased 3.0% y/y, a favorable indicator for future construction demand.
The Bureau of Economic Analysis posted data on state personal income for the third quarter of 2018 on December 20. "Construction was the leading contributor to the earnings increase in Nevada, Arizona, New Hampshire and Oregon. [Earnings] is the sum of wages and salaries, supplements to wages and salaries, and proprietors' income." Nationally, construction contributed 0.26 percentage points of the 2.8% increase in total earnings. The industry's contribution ranged from 1.05 percentage points (out of 3.3% growth in earnings) in North Dakota to -0.23 points (out of 1.2% growth) in Alaska.
The Brookings Institution posted a report in December on "Opportunity Industries" that finds "maintenance, construction, production and transportation occupations account for a disproportionate share of both good and promising jobs for sub-baccalaureate workers" (those without four-year college degrees). "Sub-baccalaureate workers who start from occupations that provide more good jobs or require more specialized training or experience, such as health care practitioners, protective service, construction, production, and science and engineering occupations, are far less likely to switch careers in order to obtain a good job.... Industries in the utilities and construction sectors that primarily serve local consumers offer good jobs for sub-baccalaureate workers at rates well above the economy-wide average. Across the nation's largest metropolitan areas, 48 percent of jobs in the utilities sector and 31 percent of jobs in the construction sector qualify as good for sub-baccalaureate workers." The report includes data on good and promising jobs by industry and occupation for 100 metro areas.
"Steel importers are winning most of their requests for tariff exclusions for products they say they can't find in the U.S., but the process is riddled with inconsistencies and frequent procedural changes, according to manufacturers and importers," the Wall Street Journal reported on Thursday. "Exclusions issued so far cover...about 16% of the finished foreign steel entering the U.S. through 11 months of 2018....Manufacturers and other importers say some of their exclusion requests are still being rejected for reasons that aren't fully explained to them." Readers are invited to send their experiences regarding tariffs, prices and delivery times for imported or competing products to email@example.com.
The number of fatal occupational injuries decreased from 5,190 in 2016 (3.6 per 100,000 full-time equivalent workers age 16 and over) to 5,147 (a 3.5 rate) in 2017, a decline of 0.8%, BLS reported on December 18. Nearly half of the decrease occurred in the construction industry, from 991 (10.1 rate) in 2016 to 971 (9.5 rate) in 2017. Within construction and extraction occupations (including construction workers in other private industries and government), fatal injuries decreased 9.7% among supervisors of construction and extraction workers, from 134 (18.0 rate) in 2016 to 121 (17.4 rate) in 2017 but increased 1.5% among construction trades workers, from 736 to 747. (BLS did not post rates for construction trades workers.)