Salt Lake City at Head of U.S. Labor Market Class

As someone often called on to make presentations on the economy, or as a salesperson wishing to sound knowledgeable when speaking with a client, it’s always good to know where the best labor markets are among cities.

This article is a handy reference piece.

For the 51 largest (by population) metro statistical areas (MSAs) in the U.S. and the 35 census metropolitan areas (CMAs) in Canada, I’ve ranked them in two ways:
(1) by year-over-year jobs creation performances (or rather, with the pandemic on the prowl, by jobs retention performances, smallest decline being most admirable); and
(2) by unemployment rates, from lowest (best) to highest (worst).

The Top-33 city rankings for the U.S. appear in Table 1, which makes use of the latest data available from the Bureau of Labor Statistics (BLS), for December 2020.

Read the rest of A National Capital is the Place to be in a Pandemic

Article source: ConstructConnect

• A Sharp Divide in the Construction Marketplace
• A Boom in Residential Construction
• Nonresidential Construction Pausing and Considering

A Sharp Divide in the Construction Marketplace

The ‘duality’ theme often ascribed to the economy these days ‒ e.g., online retail sales ‘great’ vs ‘bricks and mortar’ retail sales ‘struggling’ ‒ since the onset of the coronavirus pandemic can also be applied to the nation’s construction marketplace.

The Census Bureau’s 2020 end-of-year statistics on put-in-place investment in the U.S. showed total dollar volume being +4.7% when compared with the whole of 2019. But the growth was entirely in residential construction, +11.8%, while nonresidential stayed flat, -0.1%.

Read the rest of 12 of 16 U.S. Nonres PIP Construction Categories in the Red

Article source: ConstructConnect

Total US construction starts fell 22.3% year-on-year (y/y) in Q4 2020, taking the 2020 full-year decline to 18.3%. Non-residential building experienced the steepest decline, in both y/y terms in Q4 and for 2020 as a whole. The pandemic has weighed heavily on sectors such as hospitality, entertainment, retail and office working, with limited investment in new facilities in related sectors. Engineering construction contracted 30.3% y/y and 19.1% in 2020 overall, with the biggest drops seen in sectors related to new energy projects. Residential construction fell 1% y/y and averaged a 2.1% decline in 2020, with a marked recovery in the singlefamily segment seen towards the end of the year.

• With little economic momentum going into the year and a third wave of Covid infections limiting activity, GDP growth is expected to slow in the first quarter of 2021. However, a mix of fiscal stimulus and a gradual rollout of the vaccination program should lead to a mini economic boom this summer. Overall, we expect GDP to rise 4.2% in 2021 after a 3.5% contraction in 2020.
• US construction activity is forecast to post a “modest” rebound (relative to last year’s decline) in 2021 of 8.8%. However, the pandemic will leave severe scarring on the sector, with new construction not expected to reach its 2019 level until 2023. Civil engineering starts are expected to lead the pack, with only modest growth in non-residential building. Residential construction is expected to post the slowest growth, but against a background of a shallow decline last year, it is expected to rise above its 2019 level in 2021.
• Total construction starts in Canada in Q4 2020 declined 43.4% y/y and 22.3% in 2020 as a whole. All three headline sectors posted double-digit declines in 2020, with only activity in new residential construction showing a strong improvement by the end of the year.
• Canadian construction starts are expected to climb 11.5% this year, not rising above their pre-pandemic high (in 2018) until 2024. Like in the US, non-residential building will be the slowest to return to pre-pandemic levels, which is not expected over our forecast period to 2025. The scarring in the residential and civil engineering sectors will be less severe, with the former reaching its pre-pandemic high by 2024 and the latter by 2022.

Read the rest of The Spring 2021 edition of ConstructConnect’s Construction Starts Forecast Report

Article source: ConstructConnect

There have been two important U.S. economic data releases today: (1) advance estimates of Q4 and full year 2020 gross domestic product (GDP) growth; and (2) the latest weekly initial jobless claims number.

Both are set out in the standalone graphs below.

U.S. ‘real’ (after adjustment for inflation) GDP was +4.0% period to period annualized in Q4 2020, not so bad considering it was down by nearly a third (-31.4%) in 2020’s Q2.

More interesting, though, annual 2020 GDP was -3.5% vs 2019, not as steep a decline as was expected back in the Spring of last year.

In fact, -3.5% appears tame when compared with -11.6% in 1946, when WWII weaponry production ceased, and -12.9% in 1932, during the cold heart of the Great Depression.

Also, initial jobless claims delivered a result that was modestly upbeat. The latest weekly number on first-time unemployment insurance seekers moved in the right direction again, downwards.

It fell by -67,000 to 847,000, after climbing back up near a million in the prior week.

Read the rest of U.S. GDP Growth and Initial Jobless Claims Bring Small Smiles

Article source: ConstructConnect

Housing starts in the U.S. and Canada plunged during the several months of late winter and early spring of last year, when the coronavirus arrived in North America as an almost entirely unknown but frightening force. At the time, employment suffered a huge hit and there was an expectation by most analysts that new homebuilding activity would be suspended for a long spell.

Such dire speculation prove to be unfounded, however, partly thanks to some of the advances in high-tech that are always being talked about.

In-person home visits slammed to a stop, but real estate sales scampered to the Internet. Viewing properties remotely was a trend already underway, but it received an accelerated boost, and the usual give and take of contract negotiations switched seamlessly to digital means.

Once 2020’s summer season was underway, monthly housing starts (seasonally adjusted and annualized/SAAR) returned to normal levels and, in some months through to the end of the year, tested upper bounds.

Read the rest of In 2020, U.S. and Canadian Homebuilding Fought the Pandemic and Prevailed

Article source: ConstructConnect

Looming largest as an indicator of how well the U.S. economy can perform in the short run is the coronavirus case count. The number of new COVID-19 infections is now averaging 250,000 per day. Deaths have recently been exceeding 4,000 per day, with a cumulative mortality figure since March of 2020 that will soon surpass 400,000.

If there are any doubts about the toll this is taking on business conditions, consider weekly initial jobless claims. They dropped below a million in late August of last year and appeared to be settling in around 750,000. For the latest week, though, ending January 9, 2021, they shot back up again by +181,000, to reach a level of 965,000.

The number of individuals collecting ongoing unemployment insurance also increased in the latest period, to 5.3 million from 5.1 million at the end of last year. (Prior to COVID, the unemployed insurance recipient count was consistently below 2.0 million.)

Read the rest of 10 Mid-January 2021 Economic Nuggets

Article source: ConstructConnect

December 2020’s total employment figure in the U.S. declined by -140,000 jobs, according to the Bureau of Labor Statistics (BLS). Neither is this a surprise, nor is it quite as dire as it first seems.

The weekly jobless claims number has remained above 700,000 for 42 weeks in a row and it is still higher than the maximum level (655,000) that was reached in the 2008-2009 recession. Not much good on the jobs creation front will occur until the number of first-time unemployed begins to drop significantly.

And, of course, the new layoffs are coming as a result of surging coronavirus cases. Bars and restaurants that had been re-opening have been forced to cease or scale back operations once again.

Read the rest of U.S. and Canada Suffer Employment Setbacks in December

Article source: ConstructConnect

Table 1 sets out the best U.S. city labor markets according to two measurements, unemployment rates (with smallest being most desirable) and year-over-year jobs change (with fastest at the top).

At this present time, ‘fastest’ year-over-year jobs change means slowest decline. There isn’t a single city where there has been an increase in employment from year-previously levels.

Four cities, however, stand out (and are shaded green) for being among the Top 10 according to both criteria ‒ Salt Lake City, Indianapolis, Austin and Atlanta.

Read the rest of U.S. Construction Employment a Bright Spot in Many Major U.S. Cities

Article source: ConstructConnect

The U.S. economy may have been battered by the full-on return of the coronavirus contagion in 2020’s fourth quarter, but the nation’s principal stock markets were unfazed. The DJI, S&P 500, and NASDAQ all set new highs in December.

Compared with their low points in late March of last year, NASDAQ ended 2020 up by nearly double (+94.4%), the DJI and S&P 500 were ahead by between two-thirds and three-quarters (+68.0% and +71.4% respectively) and the TSX climbed by slightly more than half (+56%).

The Russell 2000 index, comprised of small cap companies, also performed well, +18.4% year over year and an outstanding +8.5% in December alone.

The improvements in the indices continued to be fueled by high-tech companies, which are now said to make up 40% of the S&P 500’s total market valuation.

Among the FAAMG group of companies, Apple was the leader at +83.8% year over year (i.e., Dec 31 2020 vs Dec 31 2019). Next in line were Amazon, +76.3%; Microsoft, +42.5%; Facebook, +33.1%; and Alphabet, +30.9%. Concerning that last figure of +30.9%, the ‘least’ of the FAAMG companies still managed an equity appreciation of nearly one-third.

Read the rest of Stock Markets Look Beyond Pandemic to Set Record Highs

Article source: ConstructConnect

Here are 3 (standalone) graphs on U.S. state and local government finances.

No doubt, and as is apparent from Graph 1, there were some sharp tax revenue declines in Q2 of 2020, especially in personal and corporate income taxes. Sales tax receipts also took quite a nosedive.

But in Q3, there were stunning recoveries. (Q4, when it is reported, is likely to suffer from the fall flare-up in coronavirus cases that continues to this day and which has forced significant abandonment of economic re-opening plans.)

From Graph 2, year to date total tax receipts in Q3 2020 were down by only -0.7%, with ‘property taxes’ (crucial for funding school projects) not just treading water, but ahead by +4.5%.

Read the rest of Steep Slide in State & Local Taxes in 2020’s Q2 Reversed in Q3