Despite a broader U.S. labor market rebound in June, the construction industry failed to add jobs for a third consecutive month, according to an analysis of today’s U.S. Bureau of Labor Statistics report by Associated Builders and Contractors (ABC). The construction industry’s employment level remained essentially unchanged in June.

While nonresidential specialty trade contractors collectively added 3,700 net new positions, nonresidential builders shed 1,300 positions, and heavy and civil engineering contractors reduced staffing levels by another 3,900. Residential builders trimmed their employment total by 2,400 in June, while residential specialty trade contractors added 4,700 positions.

“The construction industry unemployment rate declined to 4.6 percent in June from 5.2 percent the previous month, but not for the right reasons,” said Anirban Basu, ABC’s chief economist. “The overall national unemployment rate rose in June as labor force participation edged higher. However, the size of the construction industry labor force shrank. This may be an indication that as other segments of the U.S. economy continue to add jobs, a growing number of construction workers and construction jobseekers are shifting to other industries. There are many implications associated with this pattern, including relatively faster wage growth despite the recent flattening in nonresidential construction spending.

“As has been the case for many months, the most significant sources of weakness in construction activity and hiring relate to public spending,” said Basu. “Despite the passage of a federal highway spending bill late last year, heavy and civil engineering contractors, many of whom are engaged in work on roads and bridges, have been trimming employment. Not only did this segment shed jobs in June, but employment in this sector is slightly less than it was a year ago.

“The Bureau of Labor Statistics reported this morning that the nation added 287,000 net new jobs in June, led by job growth in leisure, healthcare, professional/business services, retail and finance. The information sector also added jobs as striking Verizon workers returned to work. Given the recent rise in oil prices, construction industry stakeholders may be speculating that some workers may have left the industry for the energy production sector,” said Basu.