The construction industry saw a dip in job openings in April, dropping to 338,000 positions—the lowest since March 2023. According to an analysis by the Associated Builders and Contractors (ABC) of data from the U.S. Bureau of Labor Statistics, this marks an 8,000 decrease from March and a 25,000 decrease from the same time last year.
He also notes that ABC’s Construction Confidence Index indicates many contractors plan to increase staffing levels in the next two quarters. Additionally, layoffs are low, and workers are quitting at high rates—both signs of a tight labor market.
Basu suggests that the weakening demand for construction workers is likely in the residential sector. More new homes were completed in the first four months of 2024 than in any similar period since 2007. With ample new-home inventory, a sluggish multifamily segment, and high interest rates, demand for new residential construction has dropped.
Despite the dip in job openings, the industry’s outlook remains optimistic. ABC’s Construction Backlog Indicator rose to 8.4 months in April, up from the previous month, though down slightly from April 2023. Contractors with annual revenues between $30 million and $100 million reported growth in backlog, indicating robust activity and confidence in nonresidential construction.
“The Federal Reserve began ratcheting up interest rates more than two years ago but one would not know it based on construction confidence and backlog,” notes Basu.
Even with rising project financing costs and new supply chain issues, contractors expect sales, employment, and profit margins to grow.
So, while construction job openings have decreased, the industry’s confidence and activity levels remain high, particularly in nonresidential construction. Contractors continue to navigate challenges like high-interest rates and rising material costs, but their outlook for the next two quarters is largely positive.
