In January 2025, the U.S. construction sector presented a mosaic of employment trends, with gains in some states offset by losses in others, according to the latest State Employment and Unemployment Summary from the U.S. Bureau of Labor Statistics (BLS). while some states experienced a boom in construction jobs,others faced notable declines,painting a complex picture of the industry’s health across the nation.

The BLS report, analyzed alongside data from industry experts, reveals that construction sector employment – encompassing both residential and nonresidential construction – increased in 23 states. Though, these gains were tempered by job losses reported in 21 states. The remaining six states and the District of Columbia reported no change in construction employment levels.

the construction industry added a net 2,000 jobs in January. This marginal increase underscores the sector’s sensitivity to various economic factors, from interest rate fluctuations to material costs and regional demand. While seemingly a positive number, the narrow margin highlights underlying vulnerabilities within the industry.

A closer look at the state-level data reveals significant disparities. Utah led the nation in job creation,adding 3,300 construction jobs,fueled by a surge in residential advancement and infrastructure projects. In contrast, Florida experienced the largest loss, shedding 5,100 jobs, perhaps due to seasonal slowdowns in tourism-related construction and the aftermath of severe weather events.

In percentage terms, Idaho recorded the highest increase at 4.0%, driven by robust growth in both residential and commercial construction. Conversely, Arkansas saw the steepest decline at 1.6%, possibly reflecting a slowdown in public works projects and private investment.

Year-over-Year Trends: A Broader Perspective

Looking at the broader year-over-year trends, the national construction sector employment rose by 178,000 jobs, reflecting a 2.2% increase. Texas led the nation in job creation,adding 19,800 jobs,capitalizing on its booming population growth and diverse economy. Though, California experienced the largest decline, losing 27,600 jobs, potentially reflecting a combination of factors, including high housing costs, regulatory hurdles, and increased out-migration.

Idaho posted the highest annual growth rate at 11.1%, continuing its upward trajectory, while Massachusetts had the sharpest decline at 3.9%, possibly due to project delays and a cooling-off in the commercial real estate market.

These state-level fluctuations highlight the diverse economic landscapes across the U.S.and the varying impact of national trends on local construction markets.

Expert Analysis and Future Outlook

the mixed employment data reflects the ongoing challenges and opportunities within the construction sector. “The relatively high number of construction industry job openings, 374,000 in December, indicates continued demand,” according to a recent CBRE report. Despite this demand, the report also notes that the overall workforce has contracted by 2%, suggesting that labor shortages are still a significant concern.

This scarcity of skilled labor continues to be a major headwind for the industry. as older workers retire, attracting and training the next generation of construction professionals is crucial. Apprenticeship programs and vocational training initiatives are essential to address this skills gap and ensure the industry can meet future demand.

Another factor impacting construction employment is the cost and availability of building materials. Supply chain disruptions, while easing somewhat, still pose challenges. Fluctuations in the prices of lumber, steel, and other key materials can influence project timelines and overall construction costs, potentially impacting hiring decisions. the recent CBRE report states, “The unemployment rate remains low both nationally and for construction as the overall workforce contracts by 2%.”

Looking ahead, the construction sector’s performance will likely depend on several key factors, including interest rates, government infrastructure spending, and the overall health of the U.S.economy. While the short-term outlook remains uncertain, the long-term demand for housing, infrastructure, and commercial development suggests that the construction industry will continue to play a vital role in the nation’s economic growth.

Addressing potential counterarguments, some might argue that the relatively small net gain of 2,000 jobs in January is a sign of weakness in the construction sector. However, this figure should be viewed in the context of the broader economic habitat, including ongoing labor shortages and supply chain challenges. Moreover, the significant year-over-year growth suggests that the industry remains resilient and adaptable.