Spending on nonresidential construction projects declined for the second month in a row in April as contractors coped with an all-time high for job openings, according to an analysis by the Associated General Contractors of America of federal spending data.
Workforce shortages are suppressing the amount of construction activity that can take place and called for measures to encourage more people to pursue high-paying construction careers, association officials said in a news release.
“Nonresidential construction spending is being held back by a paucity of qualified workers, not a lack of projects,” said Ken Simonson, the association’s chief economist. “With job openings at an all-time high and the industry’s unemployment rate at the lowest ever for April, finding workers is contractors’ top concern.”
Construction spending, not adjusted for inflation, totaled $1.74 trillion at a seasonally adjusted annual rate in April, 0.2 percent above the upwardly revised March rate and 12.3 percent higher than in April 2021. However, the monthly gains were limited to private residential construction spending, which rose 0.9 percent for the month and 18.4 percent from April 2021. In contrast, private nonresidential construction spending dipped 0.2 percent from March, although the April total was 10.1 percent higher than in April 2021. Public construction spending slid 0.7 percent for the month but increased 1.8 percent from the year-ago level.
Job openings in construction at the end of April totaled 494,000, a 40 percent increase from April 2021 and the highest total for any month in the series, dating back to December 2000. Openings exceeded the 455,000 workers hired during the month, suggesting that contractors would have hired twice as many workers as they were able to find, Simonson noted. He said a major reason unfilled positions were at an all-time high was that the unemployment rate for jobseekers with construction experience set a record low for April of 4.6 percent.