Share this on FacebookJune 8th, 2020 | by NEWCA
According to an Associated Builders and Contractors (ABC) analysis of this past Friday’s jobs report, the construction industry added a whopping 464,000 net new jobs in May. This represents the single largest monthly increase in industry jobs since the government first began tracking such information back in 1939.
“One way to look at this stunning jobs report is to suggest that economists missed the mark by approximately 10.5 million jobs,” said ABC Chief Economist Anirban Basu. “Economists polled by Dow Jones had forecasted a decline exceeding 8 million jobs. Instead, the economy added a bit more than 2.5 million jobs. It’s also possible that economists missed the mark by two to four weeks, as the economy opened up faster than most economists expected and consumers have been far more willing to engage the economy than many thought possible given the ongoing personal and public health risks presented by COVID-19.”
The data showed job gains in all three nonresidential subsegments: nonresidential building, nonresidential specialty trade contractors and heavy and civil engineering.
“For contractors, this is purely good news,” Basu continued. “With the economy beginning its recovery sooner and more dramatically than anticipated, fewer projects are likely to be postponed or canceled. Combined with rising contractor confidence, as indicated by ABC’s Construction Confidence Index, this will also help accelerate the recovery of state and local government finances as tax collections surge, ultimately resulting in more monies available to finance infrastructure.”
Basu warned that there is still reason to be cautious and concerned though. Pointing out that the remote chance at a resurgence in infections could stymie recovery, Basu observed that, “while unemployment dipped to 13.3% in May, it remains elevated. Labor force participation has been rocked in recent months, and it may be the case that many dislocated workers, including construction workers, will remain out of the labor force for an indefinite period.”
You can read more of ABC’s analysis here and more about construction’s resurgent May here.