Arizona continues to see growth in construction industry jobs

Continued strong growth in the construction industry helped keep the state’s jobless rate from increasing last month.

New figures from the Office of Economic Opportunity pegged the seasonally adjusted June unemployment rate at 4.7 percent. That’s the same as May and a tenth of a point below the rate from a year earlier.

That compares with a national jobless rate of 4.0 percent.

The numbers reflect the loss of 4,800 jobs over the month. But Doug Walls, the agency’s research administrator, said that is not a surprise: He said the normal month-over-month loss at this time of the year is 9,100, particularly with seasonal declines in employment at private colleges as well as fewer people working at hotels, bars and restaurants.

And Walls noted that overall private-sector employment is up 71,400 from the same time a year earlier.

One job out of every five added last year was in the state’s construction sector, which continues to show some signs of life after the bottom dropped out in 2006.

Then, in the middle of the housing boom, there were more than 244,000 people working to build homes, offices, roads and bridges. Within months, as the recession hit and the housing bubble burst, it plummeted to fewer than 110,000.

The latest report puts construction employment at slightly less than 160,000, meaning the industry has recovered only 37 percent of the jobs lost.

That compares with national figures that show more than three-fourths of the construction jobs lost during the recession are back.

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The “why” behind that is that the pre-recession Arizona economy was not really diversified. Instead it was based on the idea that growth — and people moving here — would continue to drive it.

In fact, before the recession, close to one job out of every 11 was in construction. So when the bottom dropped out of the economy and the housing market, Arizona got hit harder than most places.

Walls said there are some positive signs for continued growth in the industry.

He said the state’s population grew 1.9 percent in the past year, versus 1.1 percent nationally. And Walls said there has been an uptick in home ownership rates.

Walls acknowledged that the state’s jobless rate has remained more or less the same for close to a year. That compares with pre-recession levels as low as 3.6 percent.

But he said that does not mean the current 4.7 percent range is the “new normal” for Arizona.

He said the rate is determined not just by the jobs created but the number of people who tell surveyors they are looking for work. And that number, Walls said, is increasing.

“So that’s going to have an impact on the unemployment rate,” he said. And Walls said people in search of a job is a good thing.

“They’re more optimistic about their chances of finding employment,” he said. “And once they’re in the labor force, we’ve seen employment levels improve as well.”