The construction industry’s getting back to work after shedding a million jobs
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Among the economic data out this week: Spending on construction projects fell by nearly 3% in May. That figure from the Census Bureau may not sound terrible, considering that residential building saw a bigger decline: 4.5%. But behind those numbers, there are a lot of lost jobs — almost a million in an industry that hadn’t fully recovered from the last recession.
Earl McPherson has been a carpenter in New Jersey for 28 years. When the pandemic shut down a lot of construction in mid-March, he lost his job installing floors at the American Dream shopping center in East Rutherford.
Aside from a couple of days helping to build a temporary hospital for COVID-19 patients, he was out of work for six weeks.
“I was fortunate enough that we had savings, and I’m very grateful for that,” McPherson said. “But it’s all gone now, so now we have to build it back up.”
He’s back at work now building a veterinary hospital, but more layoffs are likely. Ken Simonson is chief economist with the Associated General Contractors of America. In the group’s latest survey, 40% of firms said at least one expected project had been canceled.
“I do expect that many more construction firms are going to have to lay off workers as they finish up current projects,” Simonson said.
That’s a big change from just months ago, when the industry was facing a labor shortage. Rob Dietz, chief economist of the National Association of Home Builders, said more than 400,000 residential construction workers lost their jobs last month.
“And that represented about 14% of the workforce,” Dietz said. “More discouragingly, it represented almost half of the job gains that we had picked up since the end of the Great Recession.”
And, as happened then, he worries that some workers who lose their jobs now may never come back. Mark Altobelli is back on the job in Youngstown, Ohio, after six weeks of being unemployed. While he was off, his employer sent him $200 a week to supplement his unemployment benefits.
Between that and not having to pay for child care, he said, he actually came out ahead.
“I probably went back to work and took roughly a 30% pay cut,” Altobelli said, laughing. Still, he said he’s happy to be working.
COVID-19 Economy FAQs
What’s the latest on the extra COVID-19 unemployment benefits?
As of now, those $600-a-week payments will stop at the end of July. For many, unemployment payments have been a lifeline, but one that is about to end, if nothing changes. The debate over whether or not to extend these benefits continues among lawmakers.
With a spike in the number of COVID-19 cases, are restaurants and bars shutting back down?
The latest jobs report shows that 4.8 million Americans went back to work in June. More than 30% of those job gains were from bars and restaurants. But those industries are in trouble again. For example, because of the steep rise in COVID-19 cases in Texas, Gov. Greg Abbott, a Republican, increased restrictions on restaurant capacities and closed bars. It’s created a logistical nightmare.
Which businesses got Paycheck Protection Program loans?
The numbers are in — well, at least in part. The federal government has released the names of companies that received loans of $150,000 or more through the Paycheck Protection Program.
Some of the companies people are surprised got loans include Kanye West’s fashion line, Yeezy, TGI Fridays and P.F. Chang’s. The companies you might not recognize, particularly some smaller businesses, were able to hire back staff or partially reopen thanks to the loans.
You can find answers to more questions on unemployment benefits and COVID-19 here.
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