WASHINGTON, D.C., Mar 23Construction unemployment rates were down in 10 states and unchanged in three in January on a year-over-year basis, according to analysis released today by Associated Builders and Contractors (ABC). For the nation and 37 states, rates were higher than in January 2016, ending 75 consecutive months of year-over-year declines. The national not seasonally adjusted (NSA) construction unemployment rate of 9.4 percent was up 0.9 percent from January 2016, according to data from the U.S. Bureau of Labor Statistics (BLS).

Since these industry-specific rates are NSA, it is most accurate to evaluate the national and state-level unemployment rates on a year-over-year basis.

“It was inevitable that the remarkable ongoing streak of year-over-year declines in the national unemployment rate would come to an end at some point,” said Bernard M. Markstein, Ph.D., president and chief economist of Markstein Advisors, who conducted the analysis for ABC. “The halt to this record may be largely due to the mounting shortage of skilled construction workers acting as a drag on the ability of the sector to grow. Despite this challenge, construction activity will continue to advance this year.”

In spite of the year-over-year rise, this was the second lowest national January NSA construction unemployment rate since January 2007 when the rate was 8.9 percent. Meanwhile, BLS data showed that the industry employed 162,000 more workers than in January 2016.

The usual pattern in the movement in the national NSA construction unemployment rate from December to January is an increase. Starting in 2000, when the BLS data for this series begins, the January rate has risen every year. This year’s 2 percent rate increase was no exception.

View states ranked by their construction unemployment rate
, their year-over-year improvement in construction unemployment, their monthly improvement in construction unemployment, a regional breakdown of states' construction unemployment rates and their January unemployment rates for all industries.

The Top Five States

The states with the lowest estimated NSA construction unemployment rates in order from lowest rate to highest were:

1. Hawaii
2. Utah and Virginia (tie)
4. South Carolina
5. Texas

Only one state, Hawaii, was also among the top five in December.

Hawaii, with a 6 percent estimated NSA construction unemployment rate, had the lowest rate among the states, up from fourth lowest rate in December based on revised data (previously reported as third lowest rate). It was one of the three states, along with Oregon and Pennsylvania, whose rate was unchanged from January 2016. This was also the state’s lowest January rate since the 5.1 percent rate in January 2006. Note that Hawaii’s “construction” unemployment rate is actually a rate for construction, mining and logging combined.

Utah and Virginia, with a 6.3 percent construction unemployment rate, tied for the second lowest rate in January. This was a big jump for Utah, which ranked 13th lowest in December. Utah was also one of the 10 states that experienced a year-over-year drop in its rate, down 0.2 percent, and the seventh year in a row that its January rate was down from the year before. It had the third lowest monthly increase in its rate among the states, up 0.6 percent. Also, it was the state’s lowest January rate since 2007’s 2.8 percent rate.

Virginia had the sixth lowest rate in December, tied with South Carolina, based on revised data (previously reported as fifth lowest rate). Its 6.3 percent January rate was the state’s second lowest estimated January rate since the 6.2 percent rate in 2007, behind January 2016’s 5.8 percent rate.

South Carolina, with a 6.4 percent rate, rose from tied for sixth lowest rate with Virginia in December to the fourth lowest rate in January. It was the state’s second lowest January rate, after last January’s 6.2 percent, going back to the beginning of the January estimates in 2000.

Texas moved up from tied with Delaware and Oregon for the 10th lowest NSA estimated construction unemployment rate in December to fifth lowest in January with a 6.6 percent rate. This was in spite of the state having the seventh largest year-over-year increase in its rate among the states, up 1.5 percent.

Massachusetts, which had the lowest construction unemployment rate in December, finally felt the effects of winter, with above average precipitation in January helping to push its rate up to 6.8 percent and drop its ranking to seventh lowest in January. Nevertheless, it was one of the 10 states with a year-over-year rate decline and the state’s lowest January rate since the beginning of the construction unemployment rate estimates.

Among other states that fell out of the top five in January:
  • Colorado, second lowest in December, fell to sixth lowest with a 6.7 percent rate, its second lowest estimated January rate since 6.4 percent in 2007, behind the January 2016’s 5.6 percent rate
  • Idaho, third lowest in December based on revised data (previously reported as 14th lowest rate), was tied for 10th lowest with Oklahoma, which had a 7.5 percent rate, its second lowest estimated January rate behind January 2016’s 7 percent rate since the beginning of estimates in January 2000
  • New Hampshire, fifth lowest in December based on revised data (previously reported as fourth lowest rate), was tied for 18th lowest with North Carolina with an 8.7 percent rate, its second lowest estimated January rate since 2004 with 8.5 percent, behind the January 2016 rate of 7.6 percent
The Bottom Five States
The states with the highest NSA construction unemployment rates in order from lowest to highest rates were:

46. Montana
47. Illinois
48. Rhode Island
49. West Virginia
50. Alaska

Four of these states—Alaska, Illinois, Montana and West Virginia—were also among the five states with the highest construction unemployment rates in December.

As in the previous four months, Alaska had the highest estimated NSA construction unemployment rate in January, 22.5 percent. This is to be expected since these are NSA construction unemployment rates. It is normal for Alaska to have among the highest rates in the nation around this time of year. More troubling is the 4.7 percent year-over-year increase in its rate, the largest rise among the states.

West Virginia had the second highest construction unemployment rate in January, 16.4 percent. The state had the fifth highest rate in December based on revised data (previously reported as seventh highest rate, tied with Pennsylvania). The state’s 5.5 percent increase from December was the second largest among the states behind Rhode Island’s 6.5 percent increase.

Rhode Island had the third highest estimated NSA construction unemployment rate in January, 16.3 percent. In December, the state had the 11th highest rate. However, it was among the 10 states with a drop in its year-over-year rate (down 0.3 percent) and the state’s lowest estimated January rate since the 11.3 percent rate in January 2007.

Illinois had the fourth highest rate in January, 15.8 percent. In December, the state had the third highest rate based on revised data (previously reported as second highest rate, tied with North Dakota).

Montana had the fifth highest construction unemployment rate in January, 15.3 percent. In December, the state had the second highest rate based on revised data (previously reported as fourth highest). It was among the 10 states with a drop in its year-over-year rate (down 0.3 percent).

New Mexico, which had the fourth highest construction unemployment rate in December based on revised data (previously reported as fifth highest rate, tied with Alabama), had the sixth highest rate in January, 14.5 percent. The state also had the second largest year-over-year increase in its rate, up 3 percent, behind Alaska’s 4.7 percent increase.

Note on Data Revision

On March 13, the Bureau of Labor Statistics (BLS) released its benchmark revision of state employment data covering the period from April 2015 through December 2016 (some data prior to April 2015 were also revised). The models used to estimate state construction unemployment rates were updated incorporating the new data. The revised data and the updated models resulted in some changes to the previously estimated state unemployment rates.

Most of the largest revisions occur in the winter months, which normally have the lowest number of employed construction workers and the highest number of unemployed construction workers, since small changes in the numbers can produce large changes in the unemployment rate. Also, some of the largest revisions were in states with small construction workforces. For example, North Dakota had a significantly higher unemployment rate in January 2016 (up 3.6 percent) and in February 2016 (up 2.7 percent) with the new estimates compared to the December estimates. Similarly, for January and February 2016, Montana’s estimated construction unemployment rate was up 1.4 percent and down 2.1 percent, respectively.

Another change is that BLS now provides construction-specific employment data for Tennessee starting in 1990. Previously, these numbers were only available starting in January 2014. Until now, only unemployment rates for construction, mining and logging combined could be estimated for periods prior to that date. Starting with this report, estimates of construction unemployment rates for Tennessee for all periods will be provided. However, for two states—Delaware and Hawaii—only an estimate of unemployment rates for construction, mining and logging combined is possible.

Here are tables with estimates of monthly 2015 and 2016 construction unemployment rates for each state using the data and the models prior to the benchmark revisions (December 2016 estimates) and using the revised data and models following the benchmark revisions (January 2017 estimates). Here is a table comparing the difference between the new and old estimates (after revisions minus prior to revisions).

To better understand the basis for calculating unemployment rates and what they measure, see the article Background on State Construction Unemployment Rates.