In 2014, the annual value of construction put in place was $962.1 billion which is a 4.76% increase over the $918.3 billion in construction spending in 2013. Private nonresidential construction spending was at $347.7 billion and public nonresidential construction spending was at $270.6 billion in 2014. Residential construction spending, both private and public, totaled $343,7 billion in 2014.
Construction employment was at 6,257,000 jobs at the end of 2014, up 5.39% over the 5,937,000 jobs recorded in December 2013. From December 2013 to December 2014 the construction industry added 338,000 jobs.
The construction industry has seen slow, but steady recovery since the recession with four consecutive years of job growth and construction spending increasing year-over-year since 2012. Unfortunately, not all areas of the country are recovering at the same pace with 10 states actually shedding jobs or seeing no gain in 2014 and a number of states seeing a decrease in private nonresidential construction from the prior year.
The five biggest states in terms of total private nonresidential construction spending were Texas at $30.1 billion, New York at $21.2 billion, California at $16.0 billion, Florida at $10.6 billion and Louisiana at $9.3 billion.
The bottom five states in total private nonresidential construction spending were South Dakota at $484 million, West Virginia at $442 million, Wyoming at $437 million, Rhode Island at $333 million and Alaska at $331 million. (Residential and public construction spending totals are not available by state.)
Not surprising, some of top states for private construction spending are also the ones with the most number of people employed in construction. The top five states for construction employment at the end of 2014 were California with 686,500 jobs, Texas with 677,500, Florida with 409,900, New York with 346,900 and Pennsylvania with 232,100.
The bottom five states for total construction employment in December 2014 were Delaware with 20,100, Alaska with 18,100, Rhode Island with 16,600, Vermont with 14,600 and the District of Columbia at 14,500.
Now we’ll take a look at the the biggest winners and losers in terms of private nonresidential construction spending from 2013 to 2014 in dollars and in terms of percentage change. In dollar amount, Texas was the big winner with construction spending increasing $10.3 billion dollars in 2014. This was followed by California at $2.3 billion, Florida at $2.5 billion, Louisiana at $2.3 billion and Iowa at $1.7 billion.
The state with the largest drop in construction spending in 2014 was Oregon which spent $1.5 billion less than in 2013. Ohio was next with a drop of $520 million followed by Wisconsin at $414 million less, Utah at $397 million less and New Mexico at $375 million less.
In terms of percentage change in construction spending from 2013 to 2014, Hawaii had the biggest increase with 57.81% jump in private nonresidential construction spending. Arkansas, Texas and Montana all saw an increase of more than 50% in construction spending. Oklahoma rounded out the top five with a 44.77% increase in construction spending.
South Dakota was the big loser with a 32.02% drop in year-over-year construction spending. Idaho dropped 26.57% followed by Oregon dropping 24.82%, the District of Columbia dropping 20.7% and Vermont dropping 18.99%.
As we mentioned earlier, the construction industry added 338,000 jobs from December 2013 to December 2014, but not all states saw job growth in 2014. The top five states for jobs added in 2014 were Texas with 58,700 jobs added, California with 32,100, New York with 24,900, Florida with 23,000 and Colorado with 19,700 jobs added.
Mississippi shed 7,300 jobs which was a 15.9% drop from December 2013. This was the biggest loser in terms of total jobs lost and percentage. Indiana lost 2,100 jobs, Minnesota lost 600 and Virginia and West Virginia each shed 500 jobs.
Percentage-wise, Colorado had the biggest gains by increasing construction employment by 13.29% year-over-year. North Dakota increased by 13.17%, Idaho by 12.3%, Kentucky bu 12.25% and Iowa by 12%. Construction employment in Indiana decreased by 1.71%, West Virginia by 1.55%, Delaware by 1% and Connecticut by 0.91%.
Ever wondered which states have the highest paid construction workers? The top five states for average annual salaries in 2014 are Alaska at $79,253, Massachusetts at $68,640, Hawaii at $66,553, New York at $65,325 and New Jersey at $64,911.
The five states with the lowest average annual salaries are Idaho at %39,195, Arkansas at $42,388, New Mexico at $42,707, South Dakota at $42,888 and Florida at $43,682.
The construction industry is on track to have another year of growth in terms of construction spending and employment. The seasonally adjusted annual rate of construction spending increased to $1,064.6 billion in June 2015, marking the fourth consecutive month construction spending topped $1 trillion. Most analysts point to construction spending topping out at over $1 trillion for 2015 and halfway through the year we are right on track.
The one issue that has been plaguing the construction industry is companies having a hard time filling positions for skilled labor. This is reflective in the recent construction employment reports. Construction employment has grown by 108,000 jobs during the first seven months of 2015 and by 231,000 jobs during the last 12 months. Compare this to the 215,000 jobs added during the first seven months of 2015. This averages out to roughly 15,430 jobs added each month so far in 2015.
If construction employment continues to remain relatively flat, it could begin affecting construction spending during the second half of the year. Even if spending decreases slightly before the end of the year, we should still see an increase over last year.
Note: Construction spending data came from the U.S. Census Bureau, construction employment and annual wage data came from the Bureau of Labor Statistics. All data is current as of August 13, 2015.