Construction Helps Lead Job Growth in March
The U.S. labor market showed signs of a modest rebound in March following a weak February, as payroll employment increased and the unemployment rate edged down to 4.3%. Job growth was led by construction (+26,000), healthcare (+76,000), and transportation and warehousing (+21,000).
However, signs of cooling are emerging. Job openings posted their largest decline in nearly a year and a half in February, pointing to a potential easing in labor demand. Meanwhile, growing geopolitical uncertainty adds further downside risk to the labor market outlook.
Wage growth slowed in March, with average hourly earnings rising 3.5% year-over-year. This pace is 0.7 percentage points lower than a year ago. Importantly, wage growth has been outpacing inflation for nearly two years, which typically occurs as productivity increases.
Construction Employment
Employment in the overall construction sector rose by 26,000 jobs in March, following a downwardly revised loss of 13,000 in February. Within the industry, residential construction added 14,300 jobs, while non-residential construction increased 12,200.
Residential construction employment now stands at 3.3 million in March, including 932,000 workers employed by builders and remodelers and nearly 2.4 million residential specialty trade contractors.
The six-month moving average of job gains for residential construction turned positive at 800 per month, ending a 14-month stretch of negative readings. However, over the last 12 months, residential construction has shed a net 29,300 jobs, marking the thirteenth consecutive annual decline and the longest stretch of annual losses since the Great Recession. Despite these declines, residential construction has gained 1,318,200 positions from its post-Great Recession low.
Meanwhile, the unemployment rate for construction workers rose to 5.6% in March on a seasonally adjusted basis, though it remains relatively low compared with historical norms.
See the full scope of national employment data in this Eye on Housing post.