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Construction lags behind Placer, regional job-creation trend in May

Placer?s jobless rate increases in May
By: Gus Thomson, Journal Staff Writer
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AUBURN CA - The Placer County area eked out a small increase in jobs in May, despite continued weakness in construction employment. Justin Wehner, labor market analyst with the state Employment Development Department, said that May statistics show year-over-year job numbers increasing in April and May, although not by much. ?It?s a positive sign,? Wehner said. ?A lot of job increases in May were seasonal, but we?ll take it.? May?s total number of jobs in the Sacramento-Placer-Yolo-El Dorado County region was up 2,600 ? or 0.32 percent ? year-over-year, state statistics released Friday show. The state jobs department revised its April numbers to reflect an increase of 500 jobs instead of the original loss of 100 positions, in comparison to April 2011. Wehner said April and May were the first months since November 2007 to show year-over-year job increases. The area?s unemployment rates are still well off the lows of around 3 percent five years ago. State Employment Development Department figures released Friday and covering the month of May show Placer County?s unemployment rate increased from 9.5 percent in April to 9.8 percent. At the same time, Nevada County?s jobless rate rose to 9.7 percent in May from 9.5 percent in April. Sacramento County?s stayed at 10.5 percent. El Dorado County?s jobless rate increased to 11 percent from 10.6 percent. Farming-job increases fueled much of the regional job growth, Wehner said. The sector had an increase of 1,200 jobs. But the farm-job boost is slower than normal for this time of year. ?When we look at April to May going back 22 years, that industry will usually gain 1,600 jobs,? Wehner said. The stalled construction industry, dealing with a glut of housing and commercial space, continued to cast a shadow over job growth. ?Construction looks like it?s still struggling,? Wehner said. ?It lost 500 jobs in a month when it usually gains 1,700 jobs.? Year-over-year, construction continued to lag the job-creation trend. ?When we look at the month of May compared to last year, it was the industry with the most job losses ? 3,300 jobs,? Wehner said. ?It still seems to be having a hard time.? While construction jobs have dwindled, the Roseville-based North State Building Industry Association is reporting 44 percent of new-home sales in the region it covers were in Placer County last month. The organization reported 210 new-home sales in 78 communities, representing about two-thirds of the total number of actively developed new developments in the region. North State President John Orr said that the cycle could be reaching a bottom, with home-builders seeing the beginnings of an upward tick in development but reluctant to hire new employees until they?re more certain about the future. ?They want to ensure the work is going to stick,? Orr said. The association?s statistics show new-home sales in the charted developments increased 60 percent in May over the same period last year. A total of 79 percent of the total sales were priced at, or below, $400,000. ?You?re going to see a change from negative to positive in construction jobs as long as sales continue,? Orr said. Patrick Remington, president of the Placer County Contractors Association, said custom-home work is lagging but home improvements are still in demand. ?From the perspective of my contracting business, we?ve been fairly busy ? but they?re small jobs, such as dry rot repair. We?ve only done two or three houses in the last two years, when in past years we?ve done as many as eight a year.? Remington said his feeling is that the region hasn?t seen an improvement in custom-home construction because the existing-home and foreclosure market have kept prices for those buildings low. ?But we?re definitely seeing it picking up in terms of remodels and small additions,? Remington said.