California Construction Job Turnover Rate Is 17.0%

Mike LaFirenza

As with many industries, the construction industry experienced major setbacks in the early days of the COVID-19 pandemic. Construction projects across the U.S. stopped, and employment in the industry fell by 14% from March 2020 to April 2020. While the industry has since rebounded, in part due to a nationwide housing boom and surging demand for home renovations, employment in the industry remains below pre-pandemic levels.

One issue is that construction firms are having a hard time filling jobs. According to the trade group Associated Builders and Contractors, the industry needed to hire nearly half a million more workers in 2021 to meet increased demand. Another issue is that the construction industry historically has had higher job turnover than other sectors of the economy. In 2019, before the pandemic began, the average quarterly turnover rate in the construction industry—defined as the ratio of separations to total employment—was 17.4%, or about two percentage points higher than the average across all industries, according to data from the U.S. Census Bureau.

Fortunately, job turnover rates in construction and in the economy as a whole have trended downward over the past several decades. In 1993 (the start of the Census Bureau’s Quarterly Workforce Indicators survey), the construction job turnover rate was over 27%, and the turnover rate across all industries was 19%. By 2019, turnover in the construction industry had fallen by 10 percentage points and the overall turnover rate had dropped to below 16%. Evidence suggests that broad declines in labor turnover can be explained by the aging workforce and a decrease in short-term employment spells resulting from better hiring and employment screening practices. However, the COVID-19 pandemic might reverse these trends, as more older Americans have chosen to retire early and employers have reported record numbers of quits in recent months.

While the overall job turnover rate in the construction industry pre-pandemic was 17.4%, these rates vary geographically due to a variety of factors, including the age of the workforce, availability of other job opportunities, and local industry characteristics like seasonality and unionization rates. At the state level, Maryland and Hawaii reported the most stable construction jobs in the U.S., with construction job turnover rates of 13.1% and 13.2%, respectively. Other states with low turnover rates for construction workers included Massachusetts, Vermont, Wisconsin, and Virginia. Conversely, Wyoming, North Carolina, West Virginia, and North Dakota all had turnover rates at or above 24%.

To find the states with the most stable construction jobs, researchers at Construction Coverage analyzed employment data from the U.S. Census Bureau. The researchers ranked states according to the pre-pandemic construction job turnover rate. Researchers also calculated the number of average quarterly hires, average quarterly separations, average quarterly total employment, and median earnings for construction industry workers.

The analysis found that California reports an average quarterly construction industry employment of 1,102,114 workers. The construction job turnover rate in California is 17.0%, compared to the national average of 17.4%. Here is a summary of the data for California:

  • Construction job turnover rate: 17.0%
  • Average quarterly hires: 192,255
  • Average quarterly separations: 187,027
  • Average quarterly total employment: 1,102,114
  • Median earnings for construction industry workers: $45,508

For reference, here are the statistics for the entire United States:

  • Construction job turnover rate: 17.4%
  • Average quarterly hires: 1,622,997
  • Average quarterly separations: 1,581,339
  • Average quarterly total employment: 9,072,154
  • Median earnings for construction industry workers: $41,870

For more information, a detailed methodology, and complete results, you can find the original report on Construction Coverage’s website: https://constructioncoverage.com/research/cities-with-the-most-stable-construction-jobs-2021

Mike LaFirenza writes for Lattice News Wire


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