Record employment in construction sector undermines bets that the Fed will soon pivot
The building boom has helped push unemployment to around its lowest level in more than 50 years. That is perplexing investors who want to see the Federal Reserve switch course on interest rates. Construction spending and employment have risen to records this year, boosted by government outlays for infrastructure, a domestic manufacturing renaissance and a wave of apartment building that got off to a slow start during the pandemic when prices for building materials, such as lumber, were sky high. Construction companies with jobs ranging from airport overhauls to bathroom renovations said they have enough work booked to maintain payrolls—for years in some cases. Even home builders, which slowed down last year when rates began to rise, are ramping up into spring. The persistent strength in a sector that is usually among the first to suffer job loss when borrowing costs rise is undermining investor hopes that the Fed’s aggressive interest-rate increases would quickly slow inflation and rejuvenate the stock market.
