US employers’ body, the Associated General Contractors of America (AGC), has called on the federal government to let a $300-a-week unemployment supplement introduced as relief for the jobless amid the Covid pandemic to expire next month because it believes it is keeping construction workers from returning to site.
The AGC says contractors are struggling with supply chain disruptions, rising materials prices and labour shortages, with employment in the industry declining by 7,000 between May and June this year, and with 238,000 fewer people working in construction now than before the pandemic.
"Many construction firms would likely be even busier if only they could find materials for their projects and workers for their teams," said Stephen E. Sandherr, the AGC’s chief executive. "Ending a program that is basically paying people not to work will help, especially if the administration also removes tariffs that are driving prices up on key construction materials."
Some states have already ended the unemployment supplements. The AGC said contractors in these states have experienced an increase in the number of workers looking for employment, while contractors in states that have not are still struggling to find qualified workers.
Construction spending in May totalled $1.55 trillion at a seasonally adjusted annual rate, a decrease of 0.3% from the pace in April, but 7.5% higher than the pandemic-depressed rate in May 2020, the AGC said.
Residential and nonresidential construction sectors have differed sharply in their recovery since the pre-pandemic peak in February 2020. Residential construction firms gained 15,200 employees in June and have added 51,000 workers or 1.7% over 16 months.
The nonresidential sector-comprising nonresidential building, specialty trades, and heavy and civil engineering contractors-shed 22,600 jobs in June and employed 289,000 fewer workers or 6.2% less than in February 2020.
Remarks by President Joe Biden last month indicated his agreement that the unemployment supplement should lapse on Labor Day (6 September) as scheduled.
Image: Employment in US construction declined by 7,000 between May and June this year, the AGC found (Pixabay/Pexels)