According to the US Bureau of Labor and Statistics, the construction industry labor force increased by 0.4% in Q2 2023.
Finding skilled labor continues to remain a major challenge for all aspects of the industry inclusive of shipping and trucking, manufacturing, and on-site construction. In fact, labor market strength is beginning to diverge across sectors. Residential construction is taking the biggest hits. Vacancy rates in these sectors have been volatile; For construction, vacancy rates peaked at 5.2% over the first half of 2022 but have fallen to 4.4% currently. The quits rates have also fallen sharply. Although hiring is slowing, wage growth will continue to accelerate for construction workers into 2023 given sustained shortages of workers. In short, the labor market is resilient but may yet stumble in the face of ongoing tight monetary policy, stress in the US banking system, and slowing economic growth.