The AEC Lens 
Alex Carrick, Chief Economist at ConstructConnect
Alex Carrick is Chief Economist for ConstructConnect. He is a frequent contributor to the Daily Commercial News and the Journal of Commerce. He has delivered presentations throughout North America on the Canadian, United States and world construction outlooks. A trusted and often-quoted source for … More » Canada Generates Jobs Creation Excitement in SeptemberOctober 19th, 2020 by Alex Carrick, Chief Economist at ConstructConnect
Canada’s Jobs Claw-Back Ratio Above Three-Quarters
In September, the U.S. economy experienced a fourth month of slowing jobs increase. In other words, new jobs creation decelerated. North of the border, according to Statistics Canada, there was an improvement in hiring (or re-hiring) in the latest month, versus the period before (+378,000 compared with +246,000), bringing a little more excitement to the recovery party (Graph 1). Canada’s total jobs ‘claw-back’ ratio has improved to a quite respectable 76.1% (Table 1). More than three-quarters of the positions that disappeared from February to April, due to the coronavirus-related lockdowns, have been re-acquired. Read the rest of Canada Generates Jobs Creation Excitement in September October Nonresidential Construction Starts One Quarter Lower Both M/M & YtdOctober 13th, 2020 by Alex Carrick, Chief Economist at ConstructConnect
When the value of the current month is higher than for the same month a year ago, the line will turn up; when lower, it will dip. String a couple of similar positive or negative directional changes together over several months and one has a trend. And that’s what the graphs are designed to do, show improving or deteriorating trends in a dozen major and more granular categories of construction work. Read the rest of October Nonresidential Construction Starts One Quarter Lower Both M/M & Ytd Latest Musings on the U.S. Construction OutlookOctober 6th, 2020 by Alex Carrick, Chief Economist at ConstructConnect
U.S. GDP Bounce Back
September’s So-So U.S. Jobs Report Overshadowed by Latest COVID NewsOctober 2nd, 2020 by Alex Carrick, Chief Economist at ConstructConnect
A Deceleration in Jobs Increases The total number of U.S. jobs in September, according to the latest Employment Situation report from the Bureau of Labor Statistics (BLS), rose by +661,000. An increase of nearly two-thirds of a million, on first blush, sounds wonderful. But it needs to be placed in perspective. The +661,000 gain continues the deceleration in jobs generation that has been underway since June. The net jobs increases over the latest four months have been +4.8 million, +1.8 million, +1.5 million, and most recently, +661,000. The month-to-month percentage change in U.S. total employment in September was +0.5% after being +3.6% in June, +1.3% in July and +1.1% in August. September’s seasonally adjusted (SA) unemployment rate improved to 7.9% from 8.4% in August. In September 2019, the SA jobless figure was only 3.5%. Read the rest of September’s So-So U.S. Jobs Report Overshadowed by Latest COVID News Texas, at Half Speed, Still Leads all States in Total Nonresidential Construction StartsSeptember 17th, 2020 by Alex Carrick, Chief Economist at ConstructConnect
According to ConstructConnect, U.S. nonresidential (NR) construction starts year to date in 2020 have been -26.9% compared with January-August of last year. Table 1 ranks the Top 20 states by their NR construction dollar volumes. One feature that pops out is how dominant Texas is in the NR starts arena. The state’s dollar volume of starts has been cut in half (-51.1%) so far this year, but it still ranks number one overall. (Texas in full year 2019 was home to eight ‘mega’ projects starts with a combined value of $29 billion; 2020 has seen only project valued at more than $1 billion in the state.) The dominance of Texas isn’t just because two of the other three large population states also recorded big NR starts declines. Florida was -38.3% and New York, -24.1%. Even if those two states had stayed flat, Texas would still be beating them. Three Mid-September Economic Nuggets Focusing on State and City Labor MarketsSeptember 15th, 2020 by Alex Carrick, Chief Economist at ConstructConnect
A relatively easy, but nonetheless effective, way to assess city labor markets is to rank them in two ways: (1) according to year-over-year jobs-count percentage changes, from biggest to smallest; and (2) by unemployment rates, from lowest to highest. For (1), I’d normally say from fastest to slowest, but that doesn’t currently apply. Due to the pandemic, the y/y number-employed changes for all 51 of America’s biggest cities are negative. Therefore, the ordering of urban areas according to (1) goes from those with the mildest y/y ‘total jobs’ contractions (i.e., best) to those with the most severe (i.e., worst). In Table 1, rankings (1) and (2) are shown side-by-side. Placing them next to each other facilitates a judgement as to which cities are doing best with respect to their labor markets. The six cities with green shadings in Table 1 are among the Top 10 for both smallest job losses and tightest unemployment rates. The half dozen labor market winners are Oklahoma City, Indianapolis, Salt Lake City, Austin, Dallas-Ft Worth and Kansas City. Read the rest of Three Mid-September Economic Nuggets Focusing on State and City Labor Markets A Deeper Dive into the U.S. PIP Construction Statistics Reveals a Deeper DiveSeptember 9th, 2020 by Alex Carrick, Chief Economist at ConstructConnect
From an overview perspective, the Census Bureau’s put-in-place (PIP) capital spending statistics are providing a misleading picture of what is happening in the construction marketplace. They are too buoyant. In July, total PIP spending, seasonally adjusted and annualized (in ‘current’, not inflation-adjusted dollars) was +0.1% month over month, with residential at +2.1% and nonresidential, -1.2%. The month-to-month ‘total’ for June was -0.5% and for May, -1.3%. The worst m/m percentage change for ‘total’ this year occurred in April, at -3.4%, but that was hardly alarming relative to what’s been seen in many other sectors (e.g., ‘retail’, ‘accommodation’ and ‘food services’). April was also the low m/m point for total’s two sub-sectors, residential at -4.4% and nonresidential at -2.7%. From Table 1, year-to-date PIP spending is +4.2%, comprised of residential at +6.5% and nonresidential, +2.6%. Read the rest of A Deeper Dive into the U.S. PIP Construction Statistics Reveals a Deeper Dive August’s U.S. Jobs Report Fails to Take FlightSeptember 4th, 2020 by Alex Carrick, Chief Economist at ConstructConnect
Disappointing M/M Employment Results According to August’s Employment Situation report from the Bureau of Labor Statistics, the total number of jobs in the U.S. economy in the latest month rose by +1.4 million and the seasonally adjusted (SA) unemployment rate decreased to 8.4% from 10.2% in July. The not seasonally adjusted (NSA) unemployment rate in August was 8.5%, down from 10.5% the month before. The total number of unemployment individuals in America is now 13.6 million. In August of last year, the figure was 6.0 million. The increase of +1.4 million jobs was a slowing from +1.7 million in July and +4.8 million in June. The headline numbers on jobs gain and jobless rate are probably going to be greeted with enthusiasm. It’s somewhat disappointing, though, that the percentage increases in jobs month to month for most industrial sectors aren’t more upbeat. Base or ‘denominator’ levels for the calculation are quite low Read the rest of August’s U.S. Jobs Report Fails to Take Flight Surprising Universality to Stock Market EnthusiasmSeptember 2nd, 2020 by Alex Carrick, Chief Economist at ConstructConnect
High Tech Stocks Ride to the Rescue Table 1 below shows several of the key metrics for four major U.S. and Canadian stock market indices. In August, two of the four indices managed to soar to new all-time highs, the S&P 500 and NASDAQ. Furthermore, they reached those summits during trading on the final day of the month, indicating that further upward movement might be expected in early September at least. As of closing on August 31, the DJI was -3.9% compared with its all-time peak, which isn’t much of a gap. The Toronto stock exchange was a little further behind relative to its record high achieved on February 20, 2020, -8.1%. The most astonishing number in Table 1 is NASDAQ’s climb of nearly +50% compared with August 30th of a year ago. Second best for year-over-year increase was the S&P 500, at a jump of about one-fifth (+19.6%). But a one-fifth gain, while impressive on its own, falls considerably short of a one-half gain. NASDAQ has truly been a phenomenon. Read the rest of Surprising Universality to Stock Market Enthusiasm July Nonresidential Construction Starts Down by a Quarter Both M/M & YTDAugust 14th, 2020 by Alex Carrick, Chief Economist at ConstructConnect
ConstructConnect announced today that the latest month’s volume of construction starts, excluding residential work, was $28.6 billion (green shaded box, Table 4 below), down nearly one-quarter (-23.1%) versus June’s figure of $37.2 billion (originally reported as $37.6 billion).
July 2020 nonresidential starts versus July 2019 were a jaw-dropping -44.0%. Measures to combat COVID-19 have not only depressed general economic activity, including new construction undertakings, they have seriously suppressed go-aheads for mega projects (i.e., jobs valued at $1 billion or more each). There was only one mega project start-up in July of this year ‒ $1.4 billion in rapid transit work in San Dimas California, east of Las Angeles (see Top 10 Project Starts in the U.S. – July 2020). Year to date in 2020, there have been only five mega project groundbreakings, summing to $9.45 billion. In July of last year alone, four mega projects were green-lighted for a combined $8.7 billion. (The largest was the Calcasieu Pass LNG facility in Louisiana, $4.5 billion). Read the rest of July Nonresidential Construction Starts Down by a Quarter Both M/M & YTD |
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