Most of the Construction Gains Occurred in the Nonresidential Construction Sector While Firms Now Pay Workers Nearly 19 Percent More Compared to the Average Job as they Struggle to Recruit New People
The construction sector added 27,000 jobs in June while its unemployment rate fell to 3.6 percent, its lowest rate for the month, and pay levels in the industry continued to rise, according to an analysis of new government data the Associated General Contractors of America released today. Association officials said construction firms are boosting pay and taking other steps to recruit workers amid tight labor conditions.
“Construction employment strengthened in June, with all segments adding workers despite recent weakness in demand for residential and commercial buildings,” said Ken Simonson, the association’s chief economist. “Finding enough qualified workers remains a greater challenge for most firms than finding projects to work on.”
Construction employment in June totaled 8,245,000, seasonally adjusted, an addition of 27,000 or 0.3 percent from the month prior. The sector has added 235,000 jobs during the past twelve months, an increase of 2.9 percent. Nonresidential construction firms—nonresidential building and specialty trade contractors along with heavy and civil engineering construction firms—added 21,200 employees in June. Meanwhile, employment at residential building and specialty trade contractors only grew by 5,500 or 0.2 percent.
The unemployment rate among jobseekers with construction experience declined from 3.6 percent in June 2023 to 3.3 percent, the lowest June rate in the 24-year history of the data. A separate government report released earlier this week reported that new hires in construction at the end of May totaled 383,000, growing 3 percent from one year prior. The new hires figure does not account for the number of workers who left the industry during the same timeframe.
Average hourly earnings for production and nonsupervisory employees in construction—covering most onsite craft workers as well as many office workers—jumped by 4.6 percent over the year to $35.64 per hour. Construction firms in June provided a wage “premium” of nearly 19 percent compared to the average hourly earnings for all private-sector production employees.
Association officials welcomed the jump in construction employment but noted that firms would likely have added even more jobs last month if more qualified workers were available to hire. They said those labor shortages are preventing some firms from bidding on projects, limiting the amount of competition in the construction industry.
“Boosting investments in programs that expose more students to high-paying careers in construction will put more workers on a path to middle class prosperity,” said Jeffrey D. Shoaf, the association’s chief executive officer. “Until public officials boost those investments, however, the lack of workers will undermine construction activity and constrain employment growth.”
View the construction employment data.