AGC Releases Report on Construction Employment

A new study from the Associated General Contractors of America found that construction employment expanded in the majority of U.S. metro areas, though growth remains sluggish or nonexistent in certain markets.
Keith Story

Brian Turmail, senior director of public affairs, Associated General Contractors of America.

The Associated General Contractors of America released a new study that revealed construction employment expanded in 223 metro areas, declined in 72 and was sluggish in 44 over the year-to-year period of July 2013 and July 2014.

“It’s encouraging that around 2/3 of the metro areas around the country are adding construction jobs,” Brian Turmail, AGC of America’s senior executive director of public affairs, told Commercial Property Executive. “We still have a long way to go to get back to peak employment levels, but the industry is heading in the right direction.”

The areas seeing the largest growth were Dallas-Plano-Irving, Texas (9,400 jobs, 8 percent), followed by Houston-Sugar Land-Baytown, Texas (8,900 jobs, 5 percent) and Philadelphia, Pa. (8,500 jobs, 12 percent). The largest percentage gains occurred in Lake Charles, La. (27 percent, 2,900 jobs), Crestview-Fort Walton Beach-Destin, Fla. (26 percent, 1,000 jobs) and Monroe, Mich. (23 percent, 500 jobs).

“Every market is different, but the key factors driving construction employment growth are ‘Ed’s and Med’s,’—universities and health care facilities,” Turmail said. “There is also a lot of demand in a lot of cities for some higher-end multi-family housing, as millennials are looking for places to live.”

Of those seeing the largest declines were Phoenix-Mesa-Glendale, Ariz. (-4,800 jobs, -5 percent), followed by Bethesda-Rockville-Frederick, Md. (-3,500 jobs, -10 percent) and Newark-Union, N.J. (-2,500 jobs, -7 percent).

“We are disappointed with the numbers in Phoenix, which had been growing at a quite steady clip a year or two ago and we had hoped it was turning the corner, but it looks like they are sliding back down to a construction downturn,” Turmail said.

Additionally, a second survey conducted by SmartBrief, in partnership with the AGC of America, found that two-thirds of firms report having experienced labor shortages during the past year. Over 500 newsletter subscribers completed the survey, 48 percent of whom are general contractors and 28 percent of whom are subcontractors.

“The thing that caught our eye about this workforce shortage, we had already sustained that about 2/3 of our association were having a hard time getting workers, but for us, the real interesting information is that a quarter of respondents to the survey tell us they are passing on projects because they don’t have enough workers to do the job,” Turmail said. “A few short years ago, we had firms with too many workers and not enough work, but now we have firms with not enough workers to do the job.”

These numbers were a bit surprising. While the association was aware that firms were having problems with a labor shortage, the number of firms that can’t take advantage of the recovering demand was more than it had thought.

“We’ve put together a workforce development plan, which we put together earlier this year,” Turmail said. “Our main thrust is that we think it ought to be easier for local associations and private firms to establish career and vocational training programs.”