Continued strength in construction resulted in a 7.3 percent January 2018 not seasonally adjusted (NSA) national construction unemployment rate, down 2.1 percent from January 2017 and the lowest national January rate on record, according to an analysis of U.S. Bureau of Labor Statistics (BLS) data released today by Associated Builders and Contractors (ABC). Further, estimated construction unemployment rates were down in all 50 states on a year-over-year basis.
At the same time, the construction industry employed 233,000 more workers than in January 2017.
“Strong construction activity is resulting in healthy construction employment,” said Bernard M. Markstein, Ph.D., president and chief economist of Markstein Advisors, who conducted the analysis for ABC. “The analysis of January construction unemployment marks the first time that every state in the union had a lower rate than a year ago since the beginning of the estimates in 2000.”
Because these industry-specific rates are not seasonally adjusted, national and state-level unemployment rates are best evaluated on a year-over-year basis. The monthly movement of the rates still provides some information, although extra care must be used in drawing conclusions from these movements.
From the beginning of the data series through 2017, the monthly change in the national NSA construction unemployment rate from December to January has always been an increase. The rate for January 2018 was no different, increasing 1.4 percent from December. All the states had increases as well.
The Top Five States
The states with the lowest estimated NSA construction unemployment rates in order from lowest to highest were:
1. Hawaii, 4.6 percent
2. Virginia, 4.8 percent
3. Texas, 4.9 percent
4. Colorado, Georgia, South Carolina and Utah (tie), 5.2 percent
Four of the top states were in the top five in December: Colorado, Hawaii, South Carolina and Virginia.
Hawaii repeated its number-one ranking from December. It was the state’s lowest January rate since the beginning of the estimates in 2000. Note that Hawaii’s unemployment rate is a rate for construction, mining and logging combined. The data to estimate a construction unemployment rate alone are not available for either Hawaii or Delaware.
Virginia had the second lowest January rate. That was an improvement from fourth lowest in December, tied with South Carolina. This was Virginia’s second lowest January estimated rate after the 4.7 percent rate in January 2006.
Texas had the third lowest January construction unemployment rate, an improvement from tied with Georgia for seventh lowest in December, based on revised data (previously reported as tied with Georgia and South Carolina for fifth lowest rate). It was the state’s lowest January rate on record.
Colorado, Georgia, South Carolina and Utah tied for the fourth lowest rate in January. For Colorado, that was down from second lowest in December. Nonetheless, it was the state’s lowest estimated January rate on record.
For Georgia, it was up from tied with Texas for the seventh lowest rate in December based on revised data (previously reported as tied with South Carolina and Texas for the fifth lowest rate). It was also the state’s lowest estimated January rate on record.
South Carolina’s fourth lowest ranking was the same as in December (tied with Virginia) based on revised data (previously reported as tied with Georgia and Texas for the fifth lowest rate). It was also the state’s lowest estimated January rate on record.
For Utah, January’s fourth lowest ranking was an improvement from ninth lowest rate in December. It was the state’s lowest January rate since January 2007’s 2.8 percent rate.
Massachusetts, which had the third lowest rate in December, fell to the 11th lowest rate (tied with California) with a 6.1 percent estimated construction unemployment rate. Nevertheless, it was the state’s lowest January estimated unemployment rate on record.
The Bottom Five States
The states with the highest NSA construction unemployment rates in order from lowest to highest were:
46. Illinois, 12.7 percent
47. Montana, 13.2 percent
48. Rhode Island, 13.9 percent
49. West Virginia, 14.1 percent
50. Alaska, 18.8 percent
Four of these states—Alaska, Illinois, Montana and Rhode Island—were also among the bottom five states in December.
Alaska had the highest rate in the nation for the sixth month in a row. Given that these estimates are not seasonally adjusted, a high construction unemployment rate for the state at this time of year is not surprising. On the positive side, Alaska was posted the largest drop in the country in its rate from January 2017, down 5.2 percent.
West Virginia had the second highest rate in January, compared to tied with South Dakota for seventh highest in December based on revised data (previously reported as third highest rate). This was the state’s lowest January construction unemployment rate since its 13.7 percent rate in January 2008.
Rhode Island had the third highest estimated NSA construction unemployment rate in January, compared to the second highest in December based on revised data (previously reported as fifth highest rate, tied with New Mexico). This was the state’s lowest January construction unemployment rate since its 11.3 percent rate in January 2007.
Montana had the fourth highest construction unemployment rate in January, compared to fifth highest in December based on revised data (previously reported as fourth highest rate). This was the state’s lowest January rate since the 13.1 percent in January 2008.
Illinois had the fifth highest rate in January, compared to the fourth highest rate in December based on revised data (previously reported as second highest rate). This was the state’s second lowest January rate after 2006’s 12.6 percent rate.
North Dakota, which had the third highest rate in December based on revised data (previously reported as seventh highest rate), had the eighth highest rate in January with a 10.8 percent rate.
Note on Data Revision
On March 12, the Bureau of Labor Statistics (BLS) released its benchmark revision of state employment data covering the period from April 2016 through December 2017 (some data prior to April 2016 were also revised). The models used to estimate state construction unemployment rates were updated incorporating the revised data. The revised data and the updated models used in the January 2018 estimates resulted in some changes to the December 2017 estimated state unemployment rates.
Some of the largest revisions in estimated state construction unemployment rates were in states with small construction workforces. For example, Alaska, although geographically the largest state, has one of the smallest numbers of employed construction workers. It also had the nation’s largest revision in its monthly estimated construction unemployment rate in February 2017, an increase of 4 percentage points over its previous (December 2017) estimate. North Dakota had a significantly higher unemployment rate in January 2017 (up 3.3 percent) and Rhode Island in March 2017 (up 3 percent) with the new estimates compared to the December 2017 estimates.
The average change among the states (ignoring sign) was 0.3 percent, ranging from 0.9 percent (Alaska) to 0.2 percent (16 states).
View tables including:
-Estimates of monthly 2016 and 2017 construction unemployment rates for each state using the data and the models prior to the benchmark revisions (December 2017 estimates);
-Estimates using the revised data and models following the benchmark revisions (January 2018 estimates); and
-A comparison of 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.