The February jobs report surpassed expectations by revealing a 60,000 increase in the construction workforce; this represents 99% of pre-pandemic jobs.
Nonresidential construction grew by 29,400 jobs, up 3.9% over the last 12 months. Residential added 31,000, up 4.5%. The construction unemployment rate dropped to 6.7%. The unemployment rate across all industries fell 0.2 percent since January to 3.8%.
"Bottom line: The U.S. economy is charging into the post-pandemic world with significant momentum, and nonresidential construction is part of that story," said ABC Chief Economist Anirban Basu. "At the heart of America's economic momentum is rapid workforce growth, with more people re-entering the workforce to take advantage of higher wages and to better contend with rapidly rising prices."
However, Basu also said that overall infrastructure spending in 2022 will be lower than in recent years despite the federal infrastructure spending bill. Also, inflation will drag down the economy, especially in residential construction.
Basu continued: "Interest rates are poised to rise as the Federal Reserve readies itself to deal more forcefully with what has turned out to be nontransitory inflation. Elevated oil prices could further damage the economy; this deterioration doesn't yet register on macroeconomic indicators. Elevated oil and other prices are also driving the cost of delivering construction services higher, which could result in the postponement or cancellation of some projects."
Even so, the construction industry welcomes an employment increase in a job market that has dragged for so long.