This story has been updated from its earlier version.
It’s the first Friday of the month, which means that it’s Jobs Report Day. As you’ve undoubtedly already been barraged with—either by the television or the Internet—the U.S. Department of Labor released the jobs data for the month of September this morning. Nonfarm payroll employment rose by a seasonally adjusted 114,000 jobs, and the unemployment rate fell to 7.8 percent, the lowest unemployment rate since the month of President Barack Obama’s inauguration. There were significant gains in the number of people employed in the healthcare, transportation and warehousing, and financial sectors, while manufacturing jobs took a hit. But the big driver of the lower unemployment rate is undoubtedly the significant upward revision of the July and August employment numbers (revised up 40,000 and 46,000 jobs to 181,000 and 142,000 jobs, respectively)—especially since 418,000 people decided to re-enter the labor force.
But the construction sector wasn’t invited to the party this month. For the past few months, I’ve been following the seasonally unadjusted numbers (the absolute figures) from the Bureau of Labor Statistics (see June and August here). From August to September, the construction and extraction occupations had 155,000 fewer employed individuals, with 102,000 more reporting being unemployed, bringing the total workforce down by 53,000 people. The unadjusted unemployment rate increased from 11.9 percent to 13.2 percent.
Most of this is likely due to a seasonal change, and therefore it’s not a red flag for the profession. Remember, it was September after all, and in the fall a significant number of people who work construction jobs over the summer leave for school or another job. Projects started in the spring and summer come to an end, and new work dries up in anticipation of the coming winter. (Nearly each year in the past decade has seen a similar decrease from August to September. The extremes have been in August to September 2002, in which the sector saw the only increase, and in 2010, which saw a 479,000-job decrease.)
The BLS's seasonally adjusted numbers bear this theory out. There are only preliminary numbers for August and September, but adjusted for normal market swings, the construction sector added 5,000 workers in September, and the seasonally adjusted unemployment rate rose slightly, from 11.3 percent to 11.9 percent.
However, with the exception of January and February, each month this year saw fewer people employed (seasonally unadjusted) in the construction and extraction occupations sector than in the corresponding month in 2011. Month by month, that’s loss over loss, and we shall see if that trend continues for the remainder of 2012. For an economy and a nation still struggling to recover from a massive financial crisis and recession, that is not good news.
