[Excerpt] From 2004 to 2006, construction was among the leading contributors to job growth, with employment expanding at over triple the rate of total nonfarm payrolls as measured by the Current Employment Statistics (CES) or “establishment” survey. Fueled by a boom in housing, the industry had added over a million jobs since its most recent trough in 2003. In 2006, the housing boom ended as homes sales stalled and the number of unsold homes rose. Construction employment peaked in September 2006 and then fell by 112,000 over the year. Residential construction has borne the brunt of the slowdown, shedding 192,000 jobs since March 2006.
Job losses in construction appear subdued in comparison to the sharp declines in some of the other housing indicators. Homebuilding has continued to weaken, with starts, permits, and construction spending all falling. In August 2007, the number of single family units under construction was 22.4 percent below the previous year’s level, and residential construction spending was down 16.0 percent over the year. Throughout the recent turmoil in housing, the downturn in construction spending has been confined to the residential segment, which accounts for just under half of total construction spending. Expenditures on nonresidential building and public-sector construction have continued to expand throughout the downturn, with annualized spending increasing by 14.7 percent, as of August 2007. Overall, construction spending has only declined 1.7 percent over the year ending in August.