The February release (December 2011 data) of the Job Openings and Labor Turnover Survey (JOLTS) from the Bureau of Labor Statistics (BLS) confirms a prediction we made earlier in the year. 2011 was the first year for the construction sector for which total hires exceeded total job separations since 2006.
For the overall economy, total hiring for December 2011 was relatively flat at approximately 4 million jobs. Total job openings increased to 3.4 million positions,up more than 5% since December 2010 and 38% since December 2009.
The job openings rate continues to grow and now stands at 2.5%, the highest rate since the Fall of 2008. The growth in open positions bodes well for future employment growth in 2012. However, two challenges stand out. First, there may be mismatches between the skills needed by employers and those available. Second, disruptions in the housing market, including the ability of homeowners to sell their homes and prospective homebuyers to obtain mortgage credit, can also challenge the ability of employers to fill open positions by recruiting workers who need to relocate.
Despite the good news for the construction sector (residential and non-residential) for 2011, hiring slowed late in the year. Total hiring for December by construction firms stood at 289,000, the lowest level since January 2011. The hiring rate of 5.2% was also the lowest level since the beginning of the year.
But for the year as a whole, total construction hires exceeded total separations by 46,000 positions. This is the first time since 2006 for which the construction sector added net jobs.
For 2010, the sector lost on net 173,000 jobs. For 2009 the loss was nearly 1.1 million jobs. Losses in 2008 and 2007 were 799,000 and 203,000 respectively.
The net 2011 growth for construction is relatively small compared to these recent losses, but these numbers show the impact the construction sector, and home building in particular, can have as multifamily starts continue to grow and a rebound in single-family construction takes hold.