Construction Employment Trends – California and Beyond

Attracting and retaining qualified employees is a challenge that most companies must address. For construction companies, the task is even more difficult because of the traditionally high employee turnover driven by the project nature of work and inconsistency in work opportunities. This is compounded by the perception that construction work is hard labor and low paying. Regardless of the reason, construction companies often find it difficult to attract and retain skilled labor. Making matters worse, according to the U.S. Bureau of Labor Statistics (BLS), June unemployment for the industry dropped to 4.5%, which is the lowest rate on record for June. While this reflects an increase in overall construction activity, it also makes talent acquisition even more challenging because of the reduced pool of available employees and the struggle to keep current employees motivated and engaged. To help clients, prospects and others understand the trends, JLK Rosenberger has provided a summary of key report findings below.

Key Unemployment Trends

California Construction Unemployment

The BLS report lists California as 26th in the nation for June with a 4.6% construction unemployment rate. This represents a 0.4% reduction in unemployment over June 2016 and ranks among one of the lowest rates for the state since the data started to be recorded. California also reported a month-over-month unemployment reduction – down 0.8% from May 2017. This is good news for California because it demonstrates the strength of continued construction activity across the state.

Lowest Construction Unemployment

According to the BLS report, the states with the lowest estimated construction unemployment include Idaho, Vermont, Colorado, New Hampshire and North Dakota. These states have unemployment rates ranging from 1.4% to 2.8% depending on the state. This is the second year in a row that Colorado has experienced such a low unemployment rate, matching the June 2001 unemployment rate.

Highest Construction Unemployment

The BLS report identified that the states with the highest estimated construction unemployment include Alabama, Connecticut, Mississippi, Alaska and New Mexico. These states have unemployment rates ranging from 5.9% up to 9.1% depending on the state. It’s interesting to note that although it is considered one of the highest rates in the country, Connecticut’s unemployment rate of 5.9% in June was the state’s second lowest unemployment measure in history.

Survey Calculation Information

For purposes of the report, a person is considered employed if they worked during the time in question. Unfortunately, there is no distinction made between full-time and part-time positions, although the information is tracked and used in other BLS reports. In addition, a person is considered unemployed if they didn’t have a job during the time in question but had been actively searching for employment during the four weeks prior to the survey. Finally, the total labor force is determined by adding the number of employed persons to unemployed persons. Remember that people who were not employed and not seeking employment are not included as part of the total labor force.

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The fact that construction unemployment is down across the country reflects the increased activity nationwide and opportunities for construction companies to realize growth. Although this is welcome news for construction companies in California and beyond, the additional opportunities make the focus on talent acquisition and retention even more important. If you have questions about the unemployment trends or need assistance with a tax, audit or accounting issue, JLK Rosenberger can help. For additional information please call us at 949-260-9902, or click here to contact us. We look forward to speaking with you soon.