Chart: Construction Job Opening Rate Maintains Climb
The construction labor market remains tight, as the industry sees a rising number of job openings year-over-year.
The count of open construction jobs declined for the month to 337,000 unfilled positions in December. The highest measure in the history of the data series (going back to late 2000) was 445,000 in October 2021. The housing market remains underbuilt and requires additional labor, lots and lumber and building materials to add inventory.
Hiring in the construction sector remained solid in December, albeit easing to a 4.3% growth rate. The post-virus peak rate of hiring occurred in May 2020 (10.3%) as a rebound took hold in home building and remodeling. It has trended higher since the Fall of 2020 has the broader labor market has improved and construction hiring has increased.
Construction sector layoffs ticked down in December to a 1.7% rate. In April 2020, the layoff rate was 10.9%. Since that time however, the sector layoff rate has been below 3%, with the exception of February 2021 due to weather effects. The rate trended lower in 2021 due to the skilled labor shortage.
The job openings rate in construction edged down to 4.3% in December, with 337,000 open positions in the sector. This is significantly higher than the 267,000 count recorded a year ago.
The number of job quits for the overall economy continues to be elevated as the Great Resignation continues. More than 4.3 million workers quit their jobs in December. This marked five consecutive months of a quits count of more then 4 million for the month. The number of quits in construction in December (181,000) declined somewhat, although that was off a data series high in November (225,000).
Looking forward, the construction job openings rate is likely to see increased upward pressure as both the residential and nonresidential construction sectors expand. Attracting skilled labor will remain a key objective for construction firms in the coming quarters and will become more challenging as the labor market strengthens and the unemployment rate declines.