March job numbers brought welcome news as more jobs were added to the construction market, which bodes well for the current lack of inventory in the market.
Job creation increased by 215,000 in March, while the unemployment rate remained stagnant at 5%, the U.S. Bureau of Labor Statistics reported Friday.
This rise is down from February’s increase of 242,000 workers.
“The employment data released by the Labor Department are a mixed bag. The good news was the addition of 215,000 jobs with no significant revisions to the prior months. Added to that was a fourth consecutive improvement in labor force participation,” said Doug Duncan, chief economist for Fannie Mae.
“The mix illustrated the crosscurrents affecting economic growth in the past two quarters, with some improvement in construction showing up in 37,000 added jobs as a response to the short supply of homes for sale, and the recession-like weakness in manufacturing revealed in a decline of 29,000 jobs,” continued Duncan.
The job report posted that construction employment rose by 37,000 in March, with job gains occurring among residential specialty trade contractors (+12,000) and in heavy and civil engineering construction (+11,000). Over the year, construction has added 301,000 jobs.
“New construction jobs provided a double boost to the economy in March. These jobs not only helped feed strong employment growth but also provided a lift to the housing market, where the dearth of homes for sale has stymied homebuyers for the past year. Much of the decline in new housing starts is attributable the lack of skilled construction workers, so the 12,000-worker increase in residential specialty trade contractors is welcome news in today’s report, especially when paired with the pickup in new single-family construction we saw in February,” said Redfin chief economist Nela Richardson.
In February’s homebuilder confidence report, National Association of Home Builders Chairman Ed Brady, said, “Though builders report the dip in confidence this month is partly attributable to the high cost and lack of availability of lots and labor, they are still positive about the housing market. Of note, they expressed optimism that sales will pick up in the coming months.”
On another side, Fannie Mae’s Duncan added, “The downside components were an unchanged workweek, flat year-over-year earnings growth, and a slight rise in the unemployment rate. All in all, a reasonable performance for an economy that ended 2015 on a weak note and started 2016 on an uncertain note.”