JOLT job offers for construction
JOLT job postings decreased by -325,000 in March. In this report, there was an oversized decline in the construction sector.
Specifically, the construction sector posted a decrease of -182,000 job postings in March. This increased job openings from 456,000 in February to 274,000 in March. This is a fairly sharp downward movement (see chart above) in absolute terms and also in percentage terms (the decline was -40%).
We know rates rose in 2024, but at the end of March (the JOLTS report was for March) the 10-year yield was at 4.21%. Yields across the 10-year sector (and across the curve) have since hit a high last week of 4.739%, up about 53 basis points (the 10-year yield is now at 4.68 %). This represents an increase of 12.5%.
10-year yields higher from March
Will this rate increase have a further dampening effect on the construction sector and job openings, as rates dampen demand?
You can argue that this was an isolated case. Perhaps the seasons had a negative impact. Perhaps spring weather will lead to a rebound, regardless of higher rates.
What we do know is that the housing supply is still too low. The construction of this infrastructure is still in progress. As a result, a slowdown in construction job openings is a real headache, especially as rising rates approach. .
However, with the Fed’s focus on the economy, this is potentially a piece of the puzzle that shows a slowing economy in an interest rate sensitive sector that is worth noting.
The Fed’s rate decision will be announced today at 2 p.m. ET.
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