Backward-looking data illustrate the degree of damage done by the sudden stop of the U.S. economy due to the public health response associated with the coronavirus. For example, there were 4,300 net job losses in residential construction in March, followed by a staggering 415,000 losses in home building and remodeling in April.
The leading edge of this job loss was recorded in the BLS Job Openings and Labor Turnover Survey data. In March, there were 618,000 layoffs in the construction sector. This was a striking increase over the 202,000 total in February and a 245% increase over the 179,000 count in March of 2019. More will be registered in the April data, due out from BLS in June.
The March data showed an increase of the layoff rate to 8.1% from 2.6% in February. This was the highest rate recorded in the history of the JOLTS data, which began at the end of 2001. The largest layoff rates were recorded in accommodation/food services (31.4%) and arts/entertainment/recreation (21.2%).
The one-year moving average estimates will reflect the sudden stop of the labor market in the spring as future months’ data are published. Given that job losses will be historic for April and May, the job openings rate and hiring rate will post significant declines. However, current anecdotal evidence and four weeks of gains for mortgage application data suggest that the residential portion of the construction industry labor market may now be bottoming out.
