According to a statement issued by the AGC (Associated General Contractors of America), there would appear to be some light at the end of the dark tunnel the industry is going through. However, the association is not sure if it is light indicating the end of the tunnel or simply a train coming in the opposite direction.
Construction employment increased in 138 out of 337 metropolitan areas between March 2010 and March 2011, decreased in 153 and stayed level in 46, according to a new analysis of federal employment data released today by the Associated General Contractors of America. But association officials said that the industry’s five-year employment slump is far from over, and could worsen as public construction winds down. Dallas Area and Bay City, Michigan to the list of areas adding jobs. Atlanta Area and New York City lost the most, while Lewiston, Idaho had the largest percentage decline
“Even with more metro areas adding jobs than in any 12-month period since November 2007, the fact is most areas are far below previous construction employment peaks,” said Ken Simonson, the association’s chief economist. “With federal stimulus, base realignment and Gulf Coast hurricane-protection projects slated to end soon, many areas are at serious risk of another downturn in construction employment.”
Dallas-Plano-Irving, Texas again added more construction jobs (9,800 jobs, 10 percent) than any other metro area during the past year while Bay City, Michigan, added the highest percentage (25 percent, 200 jobs). Other areas adding a large number of jobs included Chicago-Joliet-Naperville, Illinois (3,900 jobs, 4 percent); Warren-Troy-Farmington Hills, Mich. (2,800 jobs, 10 percent); and Northern Virginia (2,600 jobs, 4 percent). Large percentage gains also occurred in Flagstaff, Arizona (24 percent, 400 jobs); Elkhart-Goshen, Indiana (20 percent, 500 jobs); and Houma-Bayou Cane-Thibodaux, Louisiana (18 percent, 900 jobs).
The largest job losses were in Atlanta-Sandy Spring-Marietta, Georgia (-6,800 jobs, -7 percent) and New York City (-6,800 jobs, -6 percent), closely followed by Los Angeles-Long Beach-Glendale, California (-6,600 jobs, -6 percent). Lewiston, Idaho (-38 percent, -500 jobs) lost the highest percentage. Other areas experiencing large percentage declines in construction employment included Steubenville-Weirton, Ohio-West Virginia (-26 percent, -500 jobs); Bend, Oregon (-16 percent, -500 jobs); and Lafayette, La. (-15 percent, -1,000 jobs).
Association officials said that private nonresidential and multifamily construction appear to be stabilizing or picking up in most markets, but that the gains are likely to be offset by pending drops in public construction. Noting that prices for many key construction materials continue to rise, association officials cautioned that delaying investments in public construction could likely force taxpayers to pay more for the same work in the future.
“There is nothing fiscally responsible about buying high instead of buying low when it comes to infrastructure investments,” said Stephen Sandherr, the association’s chief executive officer. “If public officials would cut red tape and costly regulations like they are cutting construction budgets, that would help boost private sector demand.”
It is clear that the situation still remains challenging, with little indication that the Government stimulus packages introduced so far are having little effect. Discussions Roger Lindley, Editor of Contractors World had with several people at ConExpo earlier this year in Las Vegas said generally said that too little was being done too slowly. A common complaint was that the schemes so far introduces have no practical long-term planning capability.
Of concern to the industry is not so much the fewer contractors but the highly trained operatives that are being laid off in the process – many of whom will never come back, which could be a problem if there is any sudden increase in demand.