The Next Construction Boomby
New homebuilders are taking it on the chin as sales slow, but another part of the construction sector is picking up, one that's likely to keep the folks in hard hats busy for a while. Ken Simonson, chief economist for the Associated General Contractors of America trade group, notes that construction accounted for one out of every five new jobs in January--22,000 out of 111,000. "Nonresidential construction employment growth has been sizzling," he says. Over the past twelve months, contractors have boosted employment by 160,000 jobs, or 5%. Construction wages too are up nearly that amount. Architectural and engineering employment is up as well, a sign that the big building boom should continue. You can see construction cranes in a lot of new places these days, building schools, hospitals and casinos. Hines Interests, for example, is building a 60-story office tower in downtown Chicago. By contrast, residential building employment has declined by 84,000 jobs, or 2.5% in the past year. Simonson expects homebuilders will continue to shrink for most of 2007.