Data Center Boom Helps Offset Softer Construction Hiring

Construction job openings declined in August, according to the Bureau of Labor Statistics’ Job Openings and Labor Turnover Survey (JOLTS). However, strength in certain subsectors like data center construction (up 46% year over year) is creating demand for construction workers.

Construction had 251,000 open positions in August (down from 299,000 in July) but still above the 213,000 openings recorded a year earlier. The current level remains below the highs seen three years ago, reflecting weaker construction activity, particularly in residential construction.

Worker availability is another factor shaping the labor market. Increasing immigration enforcement has affected worker availability at some construction sites, including through reported no-shows, adding to the challenge many contractors face in filling open positions.

Across the broader economy, job openings also declined in August to 7.08 million, down from 7.34 million a year earlier. Even with that pullback, openings in the 7 million range suggest continued resilience in the labor market despite recent macroeconomic headwinds, including higher energy prices.

Other JOLTS measures also point to a somewhat softer hiring environment:

• The construction job openings rate declined to 2.9% in August but is up from 2.5% from a year ago.
• The construction hiring rate fell to 3.7% in August, compared with 4.1% a year earlier.
• The layoff rate edged down to 1.3%, while the quits rate was unchanged at 2.2%.

Read more insights in this Eye On Housing article from NAHB Chief Economist Robert Dietz.