Construction Adds Healthy 17,000 Jobs in May
The construction industry added 17,000 jobs on net in May, according to an Associated Builders and Contractors analysis of federal data.
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On a year-over-year basis, industry employment has increased by 68,000 jobs, up 0.8%.
“The construction industry posted healthy job gains in May, especially within the nonresidential segment,” said Anirban Basu ABC chief economist. “The industry’s recent job growth, driven by insatiable demand for data centers and ongoing growth in publicly funded construction activity, appears set to continue over the coming months.”
Nonresidential construction employment increased by 15,700 positions, with gains in all three subcategories. Nonresidential specialty traded added the most jobs, increasing by 11,400 positions. Heavy and civil engineering and nonresidential building added 2,600 and 1,700 jobs, respectively, in May.
“The bigger story in the May jobs report, however, is the surprising strength of the broader labor market,” Basu said. “Economywide job growth has accelerated, rising to a pace not seen since the early months of 2024, and the unemployment rate held steady at a perfectly acceptable 4.3% in May. This is an indication of broader economic resilience, albeit one that is not necessarily encouraging for the construction industry.”
The construction unemployment rate was 4.1% in May. Unemployment across all industries remained unchanged at 4.3% and is also unchanged from a year ago.
“The combination of a stable labor market and resurgent inflation suggests that rate hikes are now more likely than rate cuts over the next several quarters, and high borrowing costs and tight lending standards will continue to weigh on construction activity during the months ahead,” Basu said.
Based on ABC’s Construction Confidence Index, contractors continue to remain optimistic about their staffing levels growing over the next six months despite the combined news of an increase in open construction positions of 25,000 in April.
Industry job openings increased by 25,000 last month and are up by 52,000 from the same time last year.
Basu noted that fewer construction workers were laid off in April than in any month since the first half of 2022, and industrywide job openings, while still relatively low by historical standards, are up more than 25% over the past year.
“These dynamics likely stem from immigration policy and the shrinking number of undocumented workers, as well as acute shortages of certain trades workers, including those involved in data center construction,” he said. “While contractors remain broadly optimistic about increasing their staffing levels over the next six months, labor availability is unlikely to improve over the short term.”
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