Construction Adds 22,000 Jobs as Nonresidential Hiring Surges

Specialty trade contractors led July’s construction employment gains even as the broader U.S. labor market weakened.

Crane and tower construction — Photo by Frames For Your Heart on Unsplash

The construction industry added 22,000 jobs in July, bucking a weaker U.S. labor market as nonresidential contractors continued to expand their workforces, according to new federal employment data.

Construction employment reached 8.34 million in July on a seasonally adjusted basis, up from 8.32 million in June, according to the U.S. Bureau of Labor Statistics. The industry has added 82,000 jobs during the past 12 months, an increase of about 1%.

Associated Builders and Contractors said nearly all of July’s construction employment growth came from the nonresidential sector, which added approximately 20,000 jobs.

Nonresidential specialty trade contractors posted the largest gain, adding 15,400 positions during the month. Nonresidential building contractors added another 4,200 jobs, while heavy and civil engineering construction employment increased by 400 positions.

Residential construction was considerably softer. Residential specialty trade contractors added 2,600 jobs in July, while residential building construction lost about 500 positions, BLS data showed.

The construction unemployment rate stood at 3.7% in July, according to ABC, while the nationwide unemployment rate was 4.1%.

ABC Chief Economist Anirban Basu attributed much of the nonresidential strength to continued investment in data centers, saying the boom is fueling demand for specialty trade contractors. Recent construction spending figures and contractor confidence measures also point to continued hiring demand in parts of the nonresidential market.

The construction gains stood out against a notably weaker employment report for the overall economy. Total nonfarm payroll employment declined by 23,000 jobs in July, while private-sector employment increased by 30,000. BLS said job losses were concentrated in local government education and retail trade, while health care continued to add workers.

The July report also included substantial downward revisions to previous employment estimates. May’s payroll gain was revised from 129,000 to 63,000, while June’s increase was cut from 57,000 to 20,000. Combined employment gains for those two months were therefore 103,000 lower than previously reported.

Basu said those revisions and July’s overall job losses point to an emerging slowdown in the labor market. If that weakness persists, he said, construction could ultimately benefit from lower borrowing costs. Treasury yields fell following the release of the employment report.

Despite the broader economic uncertainty, July’s numbers show continued demand for workers among nonresidential contractors, particularly specialty trades. Nonresidential specialty trade employment reached approximately 2.92 million in July, up from 2.84 million a year earlier.