Chart Reveals Potential Job Report Concerns

Today's JOLTs report contained some data that may be alarming, implying that the upcoming Friday's jobs report might be disappointing. This is due to the dramatic decrease in construction job openings, which have dropped from a record high of 456K in February to a four-year low of 248K in July. This is a nearly 50% decrease in just six months, bringing the number of job openings back to the level it was in 2016.

Contradictory Data?

Interestingly, during the same period, the Department of Labor reported that the number of actual construction jobs has never been higher. In fact, the number of residential building construction jobs, at 950K, is at a record high. This presents a significant discrepancy in the data.

Which Data is Correct?

To determine which data set is accurate, one doesn't need to consider interest rates or the impact of the highest rates in 40 years on housing demand. Instead, simply examining other key metrics of the US housing market, such as new Housing Starts, which are in a significant decline, or Housing Completions, which have remained static for two years, might give a clearer picture. These factors suggest that the number of construction jobs could be on the verge of a sharp decline.

Bottom Line

The conflicting data sets present a puzzle for those trying to predict the future of the job market in the construction industry. The dramatic decrease in job openings coupled with the record high number of actual jobs creates a confusing picture. As we consider these factors, what are your thoughts on this situation? Do you think the job market in the construction industry is headed for a downturn? Share your thoughts and this article with your friends. Don't forget to sign up for the Daily Briefing, available every day at 6pm.