From 2006 to 2007, before the economy soured, construction employment in the U.S. started to ebb. In hindsight, this was a bad sign.
Construction is an economic bellwether, a leading indicator of the performance of the economy overall. Soon, the recession and its aftereffects would wipe out 25% of the nation’s construction jobs — a cool 2.5 million jobs from 2007 to 2011 when you consider salaried (payroll) and self-employed workers.
It’s encouraging, then, that over the last few years (2011 to 2014), construction jobs are projected to be up 3%, as we pointed out in a new analysis with CareerBuilder. This isn’t eye-catching growth, particularly not when taken in context. But inside the massive construction sector, a few industries have taken off (and a few others are still trending down).
Sterling Growth of Residential Remodelers and Oil & Gas Pipeline Building
EMSI projects 15 construction industries, at the 6-digit NAICS level, will grow at least 4% from 2011 to 2014. This includes large industries like plumbing, heating, and air-conditioning contractors (projected to be up 7%, or 65,000 new jobs) and electrical contractors and other wiring installation contractors (up 5%, or 45,000 new jobs).
Construction employment, 2001-2014
The most noteworthy growth, however, belongs to two industries: oil and gas pipeline and related structures construction and residential remodelers.
Thanks to the groundswell in oil and gas activity, oil and gas pipeline construction jobs grew 16% from 2011 to 2013 and are projected to grow another 8% from 2013 to 2014. These jobs pay well above the average construction job ($82,848 average annual earnings vs. $53,888). In fact, the only higher-paying construction industry is industrial building construction, at $85,174.
Residential remodelers added 45,000 jobs from 2011 to 2013, an increase of 9%. And this industry is projected to see a 8% bump as well from 2013 to 2014. The growth in home remodeling jobs comes as new single-family housing construction lost 4% of its employment base from 2011 to 2013 and is projected to drop 10% alone from 2013 to 2014. More people, it seems, are updating their existing homes than building new ones, or at least construction companies are starting to get more remodeling business than new home building business.
Other parts of construction that are doing well post-recession include another industry that falls under utility system construction — power and communication line and related structures construction – and an assortment of building finishing contractors. The full list of detailed industries can be found in the following table.
NAICS Code
Description
2011 Jobs
2014 Jobs
Change
% Change
2013 Avg. Earnings Per Job
Source: QCEW Employees, Non-QCEW Employees & Self-Employed – EMSI 2014.1 Class of Worker
237120
Oil and Gas Pipeline and Related Structures Construction
112,238
139,669
27,431
24%
$82,848
236118
Residential Remodelers
488,845
573,366
84,521
17%
$36,410
237130
Power and Communication Line and Related Structures Construction
146,996
169,326
22,330
15%
$79,184
238190
Other Foundation, Structure, and Building Exterior Contractors
48,858
56,406
7,548
15%
$46,890
236117
New Housing Operative Builders
62,862
69,533
6,671
11%
$53,532
238390
Other Building Finishing Contractors
89,253
97,944
8,691
10%
$43,710
238290
Other Building Equipment Contractors
135,524
147,818
12,294
9%
$74,029
238220
Plumbing, Heating, and Air-Conditioning Contractors
933,638
999,048
65,410
7%
$59,386
238150
Glass and Glazing Contractors
58,453
62,610
4,157
7%
$52,718
236116
New Multifamily Housing Construction (except Operative Builders)
28,579
30,475
1,896
7%
$66,955
236210
Industrial Building Construction
158,529
168,543
10,014
6%
$85,174
238120
Structural Steel and Precast Concrete Contractors
74,634
79,330
4,696
6%
$62,259
238210
Electrical Contractors and Other Wiring Installation Contractors
837,283
882,867
45,584
5%
$62,122
238990
All Other Specialty Trade Contractors
453,665
472,753
19,088
4%
$40,486
238110
Poured Concrete Foundation and Structure Contractors
188,561
196,844
8,283
4%
$44,988
236220
Commercial and Institutional Building Construction
578,353
595,778
17,425
3%
$72,277
238910
Site Preparation Contractors
469,186
477,075
7,889
2%
$42,882
237310
Highway, Street, and Bridge Construction
301,351
307,477
6,126
2%
$70,661
237990
Other Heavy and Civil Engineering Construction
112,697
115,414
2,717
2%
$73,927
238160
Roofing Contractors
209,904
211,947
2,043
1%
$43,956
238330
Flooring Contractors
122,814
121,231
-1,583
-1%
$33,059
237110
Water and Sewer Line and Related Structures Construction
160,743
158,865
-1,878
-1%
$64,207
238310
Drywall and Insulation Contractors
268,638
265,346
-3,292
-1%
$45,070
238340
Tile and Terrazzo Contractors
78,425
76,621
-1,804
-2%
$32,845
238320
Painting and Wall Covering Contractors
318,001
309,159
-8,842
-3%
$32,458
238350
Finish Carpentry Contractors
232,957
224,311
-8,646
-4%
$32,560
238140
Masonry Contractors
175,141
165,677
-9,464
-5%
$40,745
238170
Siding Contractors
49,788
46,737
-3,051
-6%
$34,465
238130
Framing Contractors
77,182
67,761
-9,421
-12%
$35,976
236115
New Single-Family Housing Construction (except Operative Builders)
425,166
364,708
-60,458
-14%
$49,689
237210
Land Subdivision
57,014
48,322
-8,692
-15%
$78,448
Total
7,455,279
7,702,961
247,682
3%
$53,888
Residential vs. Commercial Building
One of the handy higher-level industry distinctions is residential building and nonresidential (or commercial) building construction. They’re distinct 4-digit industries, and employment growth in both mirrored each other from 2011 to 2013.
Residential building construction spiked 4% from 2011 to 2013, just a touch better than commercial building jobs (3%). Yet different stories emerge when we explore each of them.
Let’s start with residential building construction.
We’ve already mentioned the major growth of residential remodelers. Likewise, new multifamily housing construction ticked up 6% from 2011 to 2013 and is projected to keep growing through 2014. Gains in both of these industries helps offset the pretty major losses in new single-family housing construction that we mentioned above.
In commercial building construction, the growth is focused mostly in commercial and institutional building construction (projected 17,000 jobs added ) versus industrial building construction (10,000 jobs added, up 6%).
It’s also interesting to note a difference in the staffing patterns (i.e, the occupations employed) in both industries. In residential building construction, 27% of jobs are taken up by carpenters and another 18% are construction laborers. But in commercial building construction, a significantly smaller percentage are carpenters (17%), while 16% are construction laborers.
The difference is made up by a larger share of cost estimators, plumbers, civil engineers, cement masons, and iron and steel workers in commercial building construction. These jobs are much more crucial to commercial building projects than residential building, and the staffing pattern reflects that.
Metros on the Move: Rochester, Austin … and Fargo
As we pointed out in our analysis with CareerBuilder, Rochester, New York, and Austin, Texas, are in the top 10 for both residential and commercial building jobs from 2011 to 2014 among metros with at least one million people. Rochester is particularly strong, coming in No. 2 on a percentage growth basis in each industry (25% commercial; 19% residential).
When we look at all metro areas with at least 1,000 jobs in each industry, Fargo, North Dakota, pops up in both residential building (35%) and commercial building (26%).
The real fast-risers emerge, however, when we look at each industry in isolation.
Commercial Building
On the nonresidential or commercial side, the South is king for growth. Meridian, Mississippi (663%), Lake Charles, Louisiana (125%), and Brunswick, Georgia (101%) all stand out.
Meridian has gone from 370 commercial construction jobs in 2011 to a projected 2,824 in 2014. A few other Southern metros — Goldberg, North Carolina (54%) and Lafayette, Louisiana (35%) — in addition to Odessa, Texas (57%) are also hotspots for commercial construction.
Meanwhile, Houston, Boston, and New Orleans are major commercial construction hubs. And in terms of total 2011-2014 job growth, as the following map shows, the Northeast, South, Midwest, and Great Plains dwarf the Western and Rust Belt metros.
Residential Building
Three metros — Provo-Orem, Utah, Napa, California, and Trenton, New Jersey — sparkle when it comes to adding residential building construction jobs. All are projected to grow at least 38% from 2011 to 2014, led by Provo’s 76%.
Ogden-Clearfield is another Utah metro on the rise (35%), followed by a long list of Florida and California metros. Both states saw huge losses during the housing bust, and both are recovering nicely.
Compared to the commercial construction map above, metros along the West Coast (from Fresno to Seattle) are faring much better in residential building employment than commercial building. The South isn’t projected to do nearly as well, as evidenced by a 16% drop in residential construction in Raleigh-Cary, North Carolina.
Meanwhile, Chicago is projected to lose the most residential building jobs — nearly 1,500 (a 5% drop). Pittsburgh isn’t too far behind, with a projected drop of 850 jobs.
Also note the performance of Phoenix, where commercial building jobs are on the upswing but residential construction is projected to lose 700 jobs.
The Self-Employment Dynamic
There are about 6 million construction jobs in the U.S. of traditional payroll (wage-and-salary) variety. And there are 1.7 million self-employed construction jobs — the most in any industry sector.
The share of self-employed jobs in construction spiked to 24% during and after the recession (2009 and 2010). But it’s dipped to an estimated 22% in 2014. So while construction employment is ticking up, the self-employed segment of the sector is declining. This is a trend we discussed in detail in our recent report on America’s self-employment landscape.
For more on EMSI’s employment data — available at the county, MSA, and ZIP code level — email Josh Wright. Follow EMSI on Twitter (@DesktopEcon) or check us out on LinkedIn and Facebook.