The Bureau of Labor Statistics (BLS)’s monthly Employment Situation report illuminates what is transpiring in the U.S. labor market. For the latest month, the headline news was that +142,000 net new jobs were created in August, ‒ except that wasn’t the complete story. Due to downwards revisions to previous monthly numbers, the increase in total employment was only +56,000 compared with the level initially reported for July. The extra weakness will provide the Federal Reserve with a strong incentive to lower interest rates in perhaps bigger steps than earlier expected.
The focal point of this article, however, is something different entirely. It’s about how construction, like so many sectors, is having trouble recruiting young workers and how the BLS, in its monthly report, lays out the best possible winning arguments based on compensation, traditionally one of the most compelling drawing cards when first career options are being weighed.
Tables B-3 and B-8 in the employment report show average hourly and average weekly earnings in major sectors of the U.S. economy. B-3’s coverage includes bosses as well as production workers. B-8 omits supervisory personnel. Since our main interest today concerns attracting young newcomers, we’ll concentrate only on B-3. Few first-time recruits immediately jump into management positions.
And yes, of course, the single figures on hourly and weekly earnings for construction gloss over the fact there are multiple levels in the real world depending on which ‘trade’ one is in. But the same average approach is adopted by the BLS for all industries.
According to August’s Table B-8, the hourly rate paid for construction workers ($35.81) is +18.3% higher than for all private sector jobs ($30.27). It is +28.1% more than for manufacturing jobs ($27.96); +22.0% more than for transportation and warehousing jobs ($29.36); +70.2% more than for retail jobs ($21.04); and +82.1% more than for leisure and hospitality jobs ($19.66).
Average hourly pay for construction work only comes up significantly short (-20.8%) versus jobs with utilities ($45.21).
Let’s concentrate on the comparison with retail, and leisure/hospitality jobs (i.e., in restaurants/bars and in hotels/motels). Those are two key competitor streams when construction is offering entry-level positions.
The figures on the premium paid hourly for construction work are dramatic on their own. But we’ll now shift to weekly earnings, and that’s where the side-by-side comparisons truly jump off the page.
Table B-7 in the Employment Situation report says the average number of hours worked weekly in construction is 39.8. In retail, it is 30.2; in leisure and hospitality, 23.9. (For all private sector jobs, it’s 33.7).
The number of hours worked times the hourly rate yields a weekly earnings figure.
On a weekly earnings basis, construction outdistances all private sector jobs by +39.7%.
Far more outstanding, the paycheck for construction work weekly whips retail by +124.3%. And going well beyond that, it exceeds the compensation for ‘leisure and hospitality’ work by +203.3%.
All of this is spelled out clearly by the BLS, once one does the math. The BLS is serving up the strongest possible selling points to the construction industry for its recruitment drives.
You hear a lot these days about both the joys and woes of the ‘gig’ economy. It’s pretty incredible that you could have a job in the retail sector ($635.41 weekly on average), plus another one in leisure and hospitality ($469.87), and still not draw near as much as if you were employed in construction ($1,425.24).
Something to think about. And thank you, Bureau of Labor Statistics!
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