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October 2006

Recent employment trends in residential and nonresidential construction

John P. Mullins

The construction industry encompasses a collection of diverse, specialized smaller industries, each serving different groups and providing different services. Although differing in timing, business and employment cycles across these subindustries have tended to follow similar patterns, rising sharply in response to economic expansions and declining in response to contractions. However, during and following the 2001 recession, consumer investment and business investment diverged from their usual patterns, while residential construction employment increased and nonresidential construction employment declined. This article analyzes trends in construction employment from 2001 to 2005, with special attention being given to the measurement of residential and nonresidential components.

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