Residential Construction: Net Job Gains Offset Losses from the Pandemic
From May through December, the number of new residential construction jobs that were created offset the total amount of jobs that were lost earlier in 2020 due to the COVID-19 pandemic.
The number of residential construction jobs rose by 22,700 in December, well above the 15,800 increase posted in November. In the past eight months, 472,500 residential construction jobs were created, offsetting all the 456,800 residential construction jobs lost in March and April due to the coronavirus outbreak.
Meanwhile, non-residential construction has recovered just 61% of the jobs that were lost in March and April.
Residential construction employment now stands at 3.0 million in December, broken down as 848,000 builders and 2.1 million residential specialty trade contractors. The six-month moving average of job gains for residential construction was 27,000 a month. Over the last 12 months, home builders and remodelers added 57,200 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 999,300 positions.
In December, the unemployment rate for construction workers was unchanged at 6.7% on a seasonally adjusted basis. After hitting 14.8% in April due to the impact of the COVID-19 pandemic, the unemployment rate for construction workers has been trending downward for the past eight months.
A Year Like No Other
On the macro level, total nonfarm payroll employment fell by 140,000 in December as virus cases surged. The unemployment rate was unchanged at 6.7% in December. This was 8.1 percentage points lower than its recent high of 14.8% in April and 3.2 percentage points higher than the rate in February. The number of unemployed persons was unchanged at 10.7 million. The labor force participation rate, the proportion of the population either looking for a job or already with a job, was unchanged at 61.5% in December.
Looking back at 2020 — a year like no other — the economy lost 1.4 million jobs in March and 20.8 million jobs in April due to the impact of the COVID-19 pandemic and efforts to contain it. The April job loss was unprecedented in the history of the data series since 1939. From May to November, 12.5 million jobs have been created. As a result, the average monthly employment growth in 2020 was a minus 781,000, compared to the average monthly job growth of 178,000 in 2019.
NAHB Economist Jing Fu provides more analysis in this Eye on Housing blog post.
*Note: This article has been redistributed from NAHBnow.com*