Library Index :: The United States Economy - Economic Reference of America :: Economic Sectors - The Twelve Sectors: Overview, Construction, Naics 23, Education And Health Services, Financial Activities, Naics 52–53

Economic Sectors - Construction, Naics 23

The construction sector includes all businesses that contribute to the development of land, roads, utilities, buildings, and such structures as bridges and dams. Included are firms that build new projects and those that provide maintenance, repairs, and alterations to existing structures. For the most part, such enterprises are managed from a central location with work performed elsewhere. The Annual Industry Accounts: Revised Estimates for 2001–2003 (Washington, D.C.: Bureau of Economic Analysis, January 2005) estimated the gross output of the construction sector to be $954.8 billion in 2003. (See Table 2.1.)

Construction Employment

The construction sector employs approximately 5.2% of the American workforce, according to Industry at a Glance, an online profile of American business maintained by the BLS. In 2003, 6,722,000 workers were employed by construction businesses. Preliminary figures for 2004 indicated that construction employment had risen to an annual level of 6,965,000, which would be the best year for construction employment since 2001

TABLE 2.1

Gross output by industry in current dollars, 2000–2003
[Billions of dollars]
Line 2000 2001 2002 2003
1Consists of agriculture, forestry, fishing, and hunting; mining; construction; and manufacturing.
2Consists of utilities; wholesale trade; retail trade; transportation and warehousing; information; finance, insurance, real estate, rental, and leasing; professional and business services; educational services, health care, and social assistance; arts, entertainment, recreation, accommodation, and food services; and other services, except government.
SOURCE: "Table 8. Gross Output by Industry in Current Dollars, 2000–03," in Annual Industry Accounts: Revised Estimates for 2001–2003 by George M. Smith, Matthew J. Gruenberg, Tameka R. L. Harris, and Erich H. Strassner, Bureau of Economic Analysis, January 2005, http://www.bea.gov/bea/ARTICLES/2005/01January/0105_Industry_Acct.pdf (accessed February 24, 2004)
1 All industries 18,186.5 18,403.2 18,811.1 19,732.8
2 Private industries 16,287.7 16,384.1 16,655.4 17,427.8
3 Agriculture, forestry, fishing, and hunting 254.3 258.7 249.6 275.1
4 Farms 203.6 210.8 201.9 223.8
5 Forestry, fishing, and related activities 50.7 47.9 47.7 51.3
6 Mining 215.9 224.4 193.7 243.7
7 Oil and gas extraction 137.6 132.2 111.5 156.0
8 Mining, except oil and gas 47.6 48.9 49.4 49.0
9 Support activities for mining 30.7 43.3 32.8 38.7
10 Utilities 319.5 343.4 329.8 356.1
11 Construction 861.5 899.8 908.9 954.8
12 Manufacturing 4,144.5 3,896.4 3,832.1 3,915.2
13 Durable goods 2,328.2 2,128.8 2,084.9 2,090.3
14 Wood products 94.1 86.9 87.8 92.4
15 Nonmetallic mineral products 95.9 93.3 87.3 86.1
16 Primary metals 155.0 135.9 134.2 128.2
17 Fabricated metal products 263.9 248.5 246.7 240.4
18 Machinery 281.6 253.2 245.9 243.5
19 Computer and electronic products 500.8 418.8 385.2 408.7
20 Electrical equipment, appliances, and components 121.7 109.9 99.8 97.6
21 Motor vehicles, bodies and trailers, and parts 466.8 420.2 436.0 423.7
22 Other transportation equipment 156.8 173.9 170.0 170.1
23 Furniture and related products 74.0 70.6 68.6 68.0
24 Miscellaneous manufacturing 117.6 117.4 123.4 131.5
25 Nondurable goods 1,816.3 1,767.7 1,747.2 1,824.9
26 Food and beverage and tobacco products 557.1 571.3 571.8 573.8
27 Textile mills and textile product mills 84.5 76.2 75. 74.1
28 Apparel and leather and allied products 66.4 56.5 58.1 58.3
29 Paper products 162.4 153.6 149.9 156.9
30 Printing and related support activities 103.4 100.1 97.7 94.4
31 Petroleum and coal products 230.4 217.5 205.9 239.6
32 Chemical products 437.6 425.0 412.3 445.9
33 Plastics and rubber products 174.6 167.5 175.7 181.8
34 Wholesale trade 867.2 851.3 871.7 909.7
35 Retail trade 1,011.1 1,021.0 1,091.4 1,132.7
36 Transportation and warehousing 592.9 571.4 572.1 592.5
37 Air transportation 121.9 106.0 101.1 116.8
38 Rail transportation 42.7 43.9 44.5 46.1
39 Water transportation 28.9 28.8 28.1 30.4
40 Truck transportation 213.2 205.7 204.1 196.8
41 Transit and ground passenger transportation 25.3 25.3 25.5 26.4
42 Pipeline transportation 26.8 27.7 31.7 31.2
43 Other transportation and support activities 101.7 100.2 99.0 101.7
44 Warehousing and storage 32.7 33.9 38.1 43
45 Information 959.2 1,000.6 1,006.0 1,037.7
46 Publishing industries (includes software) 242.2 242.8 240.4 244.4
47 Motion picture and sound recording industries 77.0 78.4 81.3 85.6
48 Broadcasting and telecommunications 554.9 587.8 586.7 609.1
49 Information and data processing services 85.2 91.6 97.5 98.5
50 Finance, insurance, real estate, rental, and leasing 3,070.1 3,137.1 3,245.6 3,438.7
51 Finance and insurance 1,389.1 1,361.7 1,356.0 1,437.0
52 Federal Reserve banks, credit intermediation, and related activities 533.8 555.6 584.9 612.0
53 Securities, commodity contracts, and investments 341.1 284.7 242.6 248.5
54 Insurance carriers and related activities 428.0 441.5 456.4 495.7
55 Funds, trusts, and other financial vehicles 86.1 79.8 72.2 80.8
56 Real estate and rental and leasing 1,681.0 1,775.4 1,889.6 2,001.6
57 Real estate 1,475.8 1,570.4 1,693.2 1,803.9
58 Rental and leasing services and lessors of intangible assets 205.2 205.0 196.4 197.8
59 Professional and business services 1,813.5 1,877.0 1,917.6 2,007.1
60 Professional, scientific, and technical services 1,036.5 1,105.6 1,129.9 1,192.1
61 Legal services 181.4 193.4 202.7 220.3
62 Computer systems design and related services 172.6 173.3 161.6 167.5
63 Miscellaneous professional, scientific, and technical services 682.4 738.9 765.6 804.3
64 Management of companies and enterprises 300.6 290.4 291.5 304.6
65 Administrative and waste management services 476.4 481.0 496.2 510.4
66 Administrative and support services 425.6 429.7 444.3 455.3
67 Waste management and remediation services 50.8 51.3 52.0 55.1
68 Educational services, health care, and social assistance 1,109.9 1,201.9 1,296.4 1,372.8
69 Educational services 140.5 150.5 157.4 163.0
70 Health care and social assistance 969.4 1,051.3 1,139.0 1,209.8
71 Ambulatory health care services 451.2 488.3 526.7 562.2
72 Hospitals and nursing and residential care facilities 430.0 464.1 506.7 535.9
73 Social assistance 88.3 98.9 105.6 111.7
74 Arts, entertainment, recreation, accommodation, and food services 640.0 655.1 682.7 719.6
75 Arts, entertainment, and recreation 147.1 154.1 163.6 170.5
76 Performing arts, spectator sports, museums, and related activities 65.9 70.6 75.9 78.5
77 Amusements, gambling, and recreation industries 81.2 83.6 87.7 92.0
78 Accommodation and food services 492.9 500.9 519.1 549.1
79 Accommodation 137.6 130.7 132.2 135.1
80 Food services and drinking places 355.3 370.2 386.8 414.0
81 Other services, except government 428.3 445.9 457.9 472.2
82 Government 1,898.8 2,019.2 2,155.7 2,305.0
83 Federal 592.0 623.8 684.5 755.4
84 General government 509.2 541.0 601.8 667.4
85 Government enterprises 82.9 82.8 82.7 87.9
86 State and local 1,306.8 1,395.4 1,471.2 1,549.6
87 General government 1,153.2 1,229.1 1,301.8 1,371.2
88 Government enterprises 153.6 166.3 169.4 178.4
Addenda:
89 Private goods-producing industries1 5,476.1 5,279.4 5,184.3 5,388.8
90 Private services-producing industries2 10,811.6 11,104.7 11,471.1 12,039.0

(6,826,000). However, according to the BLS, the unemployment rate for construction workers was 9.3% in 2003, higher than the overall unemployment rate of 6% that year. The BLS also estimated in Career Guide to Industries: 2004–05 Edition that approximately 1.6 million construction industry workers were self-employed in 2002, including more than 40% of painters, paperhangers, and flooring installers.

Construction employment often fluctuates throughout the year, especially in areas of the country that experience severe winter weather. The American Road & Transportation Builders Association (ARTBA), an industry advocacy group based in Washington, D.C., estimated in Transportation Construction Industry Employment (February 2005) that construction industry employment totaled 6,985,000 in December 2004. The ARTBA broke out the total by sub-sector, including 923,400 employees in residential building, 751,600 in nonresidential building, 319,000 in highway, street and bridge building, 367,300 in utility system construction, 86,100 in land subdivision, 95,000 in other heavy construction, 1,002,100 in building foundation and exteriors, 1,887,900 in building equipment, 926,900 in building finishing, and 625,700 in other specialty trades. The largest groups, building equipment contractors (27%), building foundation and exterior contractors (13.7%), building finishing contractors (13.3%), and residential building (13.2%) accounted for more than two-thirds of U.S. construction employment in December 2004.

Home Building

One subsector of the construction industry is the home building and remodeling industry. According to the National Association of Home Builders (NAHB), the construction and remodeling of housing in the United States accounts annually for about 15% of the gross domestic product (GDP), the nation's total economic activity. In 2003 the number of new homes sold exceeded one million for the first time in history, according to the U.S. Census Bureau. The NAHB, in Housing 2004: Facts, Figures & Trends, estimated that for each one thousand single-family homes built in the United States, 2,448 construction jobs are generated, and approximately $79.4 million in wages are paid. The NAHB further noted that the economic impact of housing on the national economy includes purchases made by homeowners during the first year of homeownership, including an average $8,905 spent on such items as furnishings, appliances, and property alterations.

Road and Transportation Construction

Another subsector of the construction industry builds roads, railroads, seaports, and airports. According to the ARTBA, construction contracts awarded in 2004 totaled more than $45.7 billion dollars. This sum, which resulted from 29,676 separate contracts, was more than $1 billion below the 2003 total. In 2004, according to ARTBA's U.S. Transportation Construction Market Report, highway construction totaled $31.5 billion on 23,432 projects; bridge and tunnel contracts totaled $10 billion; airport construction contracts amounted to $1.7 billion; railroad construction accounted for $2 billion; and construction projects on docks, piers, and wharves totaled about $550 million.

Annual employment numbers in the transportation and road construction industry were up in 2004 after a downturn in 2003. According to Transportation Construction Industry Employment Annual Report—2004, prepared by ARTBA and available online (www.artba.org), the monthly average for highway, street, and bridge employment in 2004 was nearly 347,700. This represented a 2.2% increase over the 2003 average (340,100) and a 20.5% increase since 1990 (288,500). The average highway, street, and bridge worker spent 41.5 hours on the job each week during 2004 and earned a weekly paycheck of approximately $801.

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