The construction industry added 15,000 jobs on net in June, according to an Associated Builders and Contractors analysis of data released by the U.S. Bureau of Labor Statistics.

On a year-over-year basis, industry employment has increased by 121,000 jobs, representing a 1.5% rise.

Nonresidential construction employment expanded by 9,200 positions on net, with growth registered in just one of three major subcategories. Nonresidential specialty trade added 12,400 jobs, while heavy and civil engineering and nonresidential building lost 2,800 and 400 jobs, respectively.

The construction unemployment rate fell to 3.4% last month. Unemployment across all industries declined from 4.2 percent in May to 4.1 percent in June.

“Virtually every economist has been waiting for indications of stagflation,” said ABC Chief Economist Anirban Basu. “The wait continues."

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June’s employment report, along with recent inflation data, indicates that the U.S. economy is maintaining strong momentum, with stable unemployment rates and decreasing inflation. Construction employment has risen for the second month in a row.

“While many will cheer this jobs report, some construction firm leaders may not be among that group,” said Basu. “While abating fears of recession are comforting, these data effectively slammed the door shut on a July Federal Reserve interest rate cut."

An increasing number of contractors face a weakening backlog as project delays occur amid economic uncertainty and persistently high borrowing costs, Basu added.

“At the same time, construction materials prices have begun to edge higher, in part because of substantial tariffs on steel, aluminum, Canada, Mexico and China,” he continued.

“All things equal, that will drive up construction delivery costs, render more projects uneconomical and diminish contractor margins. Shifting immigration policy stands to reinforce these dynamics. Close attention should be paid to the profit margins component of ABC’s Construction Confidence Index in the coming months, which should reflect how these higher costs are affecting contractor operations.”