Residential construction employment finished 2011 in positive territory, the first time that the sector has experienced gains in six years, according to new data from Calculated Risk’s Bill McBride.
Not since 2005, when residential construction increased by an incredible 268,000 jobs, has construction been at a positive level. The high of 2005 was followed by respective declines (in thousands) of 62, 273, 510, 431 and 113 in the subsequent years, so clearly, though 2011’s gain of 20,000 may not seem like much, its following a steep decline from 2006 to 2010.
“After five consecutive years of job losses for residential construction (and four years for total construction), construction employment increased in 2011,” McBride wrote. “In addition residential investment has made a small positive contribution to GDP in 2011 – also for the first time since 2005.”
Total construction employment was also positive in 2011, which has not occurred since 2006. After adding 416,000 jobs in 2005 and 152,000 in 2006, total construction dropped in the following years (in thousands) by 198, 787, 1053 and 149, before recording in 2011 with 46,000 new jobs.
McBride also noted that the nature of construction’s recovery is unique to this downturn. Generally, residential construction leads the economy out of a recession, but because of the nation’s still-formidable supply of vacant homes, residential construction, even with its recent gains, has been lagging by historical standards; therefore, non-residential construction, at a growth of 26,000, grew faster than residential’s 20,000.