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Construction Unemployment Rates Improve, ABC Says

September not seasonally adjusted (NSA) construction unemployment rates improved in 32 states and the nation on a year-over-year basis, according to analysis released by Associated Builders and Contractors (ABC). The national NSA construction unemployment rate of 5.2 percent was 0.3 percent lower than a year ago, according to data from the Bureau of Labor Statistics (BLS).

This was the lowest September construction unemployment rate since 2000, when it was 4.6 percent. BLS data also reported that the industry employed 208,000 more people than in September 2015.

“September 2016 marks the sixth year of uninterrupted monthly year-over-year rate decreases in the national construction unemployment rate that began in October 2010,” said Bernard M. Markstein, Ph.D., president and chief economist of Markstein Advisors, who conducted the analysis for ABC. “These industry-specific unemployment rates are not seasonally adjusted, so it is important to note states’ performance on a year-ago basis. The year-over-year improvement in the national unemployment rate as well as in the rates of 32 states demonstrates the steady improvement in the construction job market over the past year.”

Like August, the historical pattern for change in the national NSA construction unemployment rate from the month before is ambiguous. Starting in 2000, when the BLS data for this series begins, through 2015, the change in the September rate from August has fallen eight times, risen seven times and been unchanged once. This year’s September increase of 0.1 percent adds an eighth year that the rate has risen from August.

Eighteen states did post declines in their estimated construction unemployment rates from August. Five states had unchanged rates.

View states ranked by their construction unemployment rate, their year-over-year improvement in construction employment and monthly improvement in construction employment.

View states unemployment rate for all industries.

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

1.    Colorado
2.    South Dakota
3.    Idaho and North Dakota (tie)
5.    Massachusetts

Four states—Colorado, Idaho, Massachusetts and North Dakota—were also among the top five in August. Colorado had the lowest rate among the states in September at 2.4 percent, the state’s lowest September unemployment rate on record. South Dakota, with a 2.9 percent construction unemployment rate, moved up to the second lowest rate in September and also had the second largest year-over-year drop, down 1.3 percent. Idaho and North Dakota tied for the third lowest rate in September with a 3 percent rate, up from fifth lowest and down from the lowest rate in August respectively. Massachusetts tied with South Dakota and Arizona for the biggest year-over-year improvement by shedding 1.3 percent from its construction unemployment rate in posting the fifth lowest rate in September at 3.3 percent rate, also the state’s lowest rate.

Wyoming dropped from the top five in August and experienced the largest monthly and year-over-year jump in its NSA construction unemployment rate—up 2.7 percent and 1.7 percent, respectively—to 5.3 percent.

Meanwhile, Vermont fell from tied with Idaho for fifth lowest in August to tied with Michigan for 13th lowest in September with a 4.3 percent rate. Vermont also had the fourth largest monthly increase, up 1.1 percent from August.

The Bottom Five States
The states with the highest NSA construction unemployment rates in order from lowest to highest rates were:

46.    Alabama
47.    Pennsylvania
48.    Rhode Island
49.    New Mexico
50.    Alaska

All of these states were also among the five states with the highest construction unemployment rates in August.

Alaska, with a 10.1 percent rate, had the highest estimated rate in September and saw the second largest increase from August at 2.5 percent. On a positive note, Alaska’s September 2016 rate was its lowest September rate since 2002. New Mexico had the second highest construction unemployment rate in September, 8.6 percent, although it also had the second largest monthly drop in its rate—down 0.9 percent. Rhode Island had its lowest September construction unemployment rate since 2007, but was still the third highest rate in September at 8.5 percent. Pennsylvania had the fourth highest estimated NSA construction unemployment rate in September, 8.1 percent, and the second largest year-over-year increase among the states, up 1.5 percent. Alabama had the fifth highest estimated construction unemployment rate in September, with a 7.6 percent rate, its second lowest September rate since 2007 (just above 2015’s 7.5 percent).

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