Despite reports that the recession has ended, the nonresidential construction industry lost 13,000 jobs in September and private nonresidential construction spending fell 0.1 percent in August, according to the most recent reports by the U.S. Department of Labor and the U.S. Census Bureau.
Since September 2008, the nonresidential construction industry has lost 107,800 jobs, bringing the number of jobs in that sector down to 710,700. Although private nonresidential construction saw only a modest decrease in August, compared to one year ago spending is down 10.5 percent. In addition, total nonresidential construction spending, including both private and public, fell 0.4 percent on a monthly basis and is down 4.7 percent compared to last year.
“After several months of improvement in terms of reduction in the pace of job losses, September’s performance indicates that the labor market is no longer steadily improving,” said Anirban Basu, ABC’s chief economist. “Because consumer confidence, in part, is so clearly impacted by employment and unemployment statistics, the reality now is that the U.S. economy has moved one step closer to the inevitable – double digit employment.”
Overall, the construction industry lost 64,000 jobs last month and is approaching 1.1 million lost since last year. Residential construction contributed to the decline, losing 7,400 jobs in September. Meanwhile, residential construction spending rose 4.2 percent on a monthly basis, bringing monthly overall construction spending growth to 0.8 percent, although it is still down compared to last year.
“Many nonresidential and residential contractors have been hanging on financially, but are now giving up because the pace of economic recovery has simply not been sufficiently brisk,” said Basu. “Though construction clearly benefits from the addition of infrastructure monies as part of February’s stimulus package, this financial assistance does not appear to be enough to offset the persistent tight credit market and the lack of demand for new retail, lodging, office and other space.”
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