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Report Forecasts Large Scale Redundancies Within Construction
A study conducted across the Construction Industry in the United States has concluded that, by the end of 2008, up to a quarter of a million less people could be employed within the sector. The report was published by analysts at Macroeconomic Advisors, who used figures obtained from the Labor Department, in addition to information from the ADP National Employment Report - which is yet to be published � in the course of their research. According to them: �...by the end of next year construction employment could fall approximately 250,000.�
Furthermore, the report indicates a significant workforce slump could already have taken place, in comparison to the most recent data relating to national payrolls. The deficit, it states, could, even by now, be in the region of 160,000. The study continues to suggest that, over the period til 2008 year-end, 14,000 jobs will be lost each month. This, say the analysts, �wouldn�t be pretty, but neither would it be calamitous for the national economy. Indeed, such a decline would be smaller than many commentators suggest is likely.�
Between the period running from January last year to May 2007, a plummet of 36 per cent was observed in respect of single-family housing starts. However, in the wake of a peak attained in September 2006, employment within the construction industry has shed only 0.6 per cent. Economists within the sector have attributed this figure to a number of causes, these including companies with slow adjustment procedures, and situations where undocumented workers fail to subsequently apply for unemployment benefit. Another suggested factor is in relation to the Labor Government�s estimating procedures, where they point to possible elements of bias.
In respect of the new report, a significant difference is noted within the size of the companies within Construction; large to medium-sized firms exhibiting more tendencies toward initiating redundancies than their smaller counterparts. In response, the economists highlight the failures of arguments linking a decline in spending within Construction to a perceived workforce shrinkage. The wave of redundancies, they state, should have wrapped itself up before Spring 2008.
Source � Construction International�s US Correspondent