March Sees Significant Drop in Construction Jobs

The number of total job vacancies for the entire economy has decreased over the last year as monetary policy has tightened.

This is consistent with a somewhat calmer economy, which is a good omen for future inflation rates.

However, the number of open jobs in the overall economy remained relatively stable in March, according to the Bureau of Labor Statistics Job Openings and Labor Turnover Survey (JOLTS).

In March, the number of available jobs in the economy decreased to 8.49 million. This figure is lower than the 9.62 million reported a year earlier.

According to NAHB estimates, this number must decrease below 8 million before the Federal Reserve may feel more confident about labor market conditions and their potential impact on inflation.

While the Fed expects rising interest rates to have an influence on the economy’s demand side, the ultimate solution to the labor shortfall will be found by attracting, training, and retaining talented people, rather than decreasing labor demand.

This was where the possibility of a monetary policy error could arise. Good news for the labor market does not necessarily mean bad news for inflation.

The number of open construction positions fell unexpectedly in March, from 456,000 in February to 274,000 in March.

The figure was 291,000 a year earlier, at a period of slower housing development. It is probable that this figure will be revised upward in the following report. Alternatively, the reduction could represent the persistent weakness in apartment building.

Nonetheless, the construction job openings rate fell to 3.2% in March, its lowest level since the fall of 2020.

The construction sector layoff rate fell to 1.8% from 3.6% a year earlier. In March, the hiring rate fell to 4.1% from 5.2% a year earlier.

(Read more about this topic on Eyeonhousing.org)