Backward-Looking April Construction Data: Layoffs Surged
Backward-looking data from the Job Openings Labor Turnover Survey (JOLTS) detail the sudden stop associated with the coronavirus and its impacts on the construction labor market.
The April data show that the layoff rate in the construction sector increased from 7.9% in March to 10.4% in April. This is the highest rate recorded in the history of the JOLTS data, which began at the end of 2001. The largest layoff rates were recorded in arts/entertainment/recreation (23%).
In total, the construction sector recorded almost 1.3 million layoffs during March and April. According to the separate Bureau of Labor Statistics monthly labor market report, the construction sector lost 422,000 jobs in April, followed by a more promising gain of 226,000 in May. Next month's JOLTS data should reflect this more positive direction for jobs.
The one-year moving average estimates will more fully reflect the sudden stop of the labor market in the spring as future months' data are published. Yet, despite the historic nature of the shutdown of parts of the U.S. economy and record-high unemployment rate in the construction sector, the April data nonetheless show a job openings count in construction of 256,000.
Given the May gain for home builder and remodeling employment, the construction rate in next month's JOLTS report should show momentum for hiring in the construction sector.
NAHB Chief Economist Robert Dietz provides more analysis in this Eye on Housing blog post.