'Year of Low Demand,' Says AGC

Aug. 31, 2010
Hoping for turnaround sometime next year

Construction employment declined in 276 out of 337 metropolitan areas between July 2009 and July 2010, according to a new analysis of federal employment data released today by the Associated General Contractors of America. The employment figures demonstrate the widespread decline in demand for construction services that continues to outpace stimulus-funded work, association officials noted. “There is no doubt that we have seen an increase in stimulus activity this summer,” said Ken Simonson, the association’s chief economist. “Unfortunately, that increase in stimulus activity is largely being overshadowed by continuing declines in overall demand for construction that are likely to persist well into next year.”

Simonson noted that the Chicago-Joliet-Naperville area lost more construction jobs (32,900 jobs, 23 percent) than any other metro area, reflecting a construction strike that has since ended.

Flagstaff, Arizona (700 jobs, 32 percent) lost the highest percentage.

Other areas experiencing large declines in construction employment included Las Vegas (14,800 jobs, 24 percent)
Houston (14,700 jobs, 8 percent)
Los Angeles-Long Beach-Glendale (10,700 jobs, 9 percent)
Seattle-Bellevue-Everett (10,400 jobs, 14 percent).

Simonson noted that 31 metro areas added construction jobs over the past 12 months, while another 30 areas experienced no change in construction employment.

Calvert-Charles-Prince George’s Counties in Maryland added more construction jobs (2,800, 8 percent) than any other metro area while Eau Claire, Wisconsin added the highest percentage (16 percent, 500 jobs).

Other areas adding jobs included
Kansas City, Kansas (1,700 jobs, 9 percent)
Pittsburgh, Pennsylvania (1,500 jobs, 3 percent)
Columbus, Ohio (1,000 jobs, 3 percent)
Chattanooga, Tennessee (700 jobs, 8 percent).

The construction economist said the impacts of the stimulus can be seen in the fact that many of the construction employment declines metro areas are experiencing are less severe than even a month ago. The year-over-year construction employment declines in cities like Las Vegas, Houston and Seattle are less severe than the figures recorded in June, Simonson noted. However, he added that too few cities were adding construction jobs to have any widespread impact on construction employment.

“As much as we would hate to see how much worse the construction employment figures would be without the stimulus, the fact is our industry is continuing to suffer even as some areas of the economy have begun to expand,” said Stephen Sandherr, the association’s chief executive officer. “And with regular, long-term infrastructure bills stalled in Congress, it looks like construction workers will have little opportunity to continue rebuilding our economy.”