Construction Economic News

The latest Employment Situation Report from the Bureau of Labor Statistics speaks of a +150,000 gain in the total number of U.S. jobs in October. That figure on its own is ho-hum. It is the second lowest monthly increase since pandemic days. (June of this year was weaker at +105,000).

The headline number for U.S. jobs growth in August, from today’s release of the Employment Situation report, authored by the Bureau of Labor Statistics (BLS), is +187,000, which sounds pretty good at first reading. Upon closer examination, however, it loses some luster.

Try thinking like a central banker. Your main goal at the moment is to bring down inflation to around +2.0% year over year. Your primary weapon to achieve that end is high interest rates. They’ll slow consumer spending and housing starts but will also cause collateral damage in labor markets. Signs of kinks in job creation will be greeted with a smile.

As my colleague, Michael Guckes is wont to say, every economic cycle is different. The study of ‘the dismal science’ (as economics has sometimes been labeled) in school lecture halls pretends otherwise.

Clichés are often true and it is the case that a picture can be worth a thousand words.

The accompanying table records the top 10 project starts in the United States for June 2023.

A New Milestone for Megas ConstructConnect announced today that June 2023’s volume of construction starts, excluding residential work, was $63.2 billion, an increase of +25.5% versus May 2023’s figure of $50.3 billion (originally reported as $49.2 billion).

So far, minimally deterred by the Federal Reserve’s interest rate hikes, the unemployment rate in the United States has stayed near rock bottom. Seasonally adjusted (SA), it’s been less than 4.0% for 15 months in a row, indicative of a labor market that’s about as tight as it has ever been.

Joy was expressed by economic commentators when the Bureau of Labor Statistics reported May’s year-over-year change in the headline Producer Price Index to be a mere +1.2%. As Graph 1 illustrates, there’s a close correlation between changes in the Consumer Price Index (i.e., inflation) and changes in the top-level PPI number.

Clichés are often true and it is the case that a picture can be worth a thousand words.