Construction Quits Hit 198,000; Openings Up 92,000 Year Over Year

By Amara Osei

The U.S. Bureau of Labor Statistics (BLS) reported on Tuesday that 198,000 construction workers quit their jobs in September. Anirban Basu, chief economist for Associated Builders and Contractors, said the total was the highest reported since the first half of 2023.

ABC described contractors as struggling to retain skilled workers as data-center construction increased competition for labor. The BLS's September data showed that worker turnover had become a larger industry issue. Basu said the high quit count could signal a tightening labor market.

“Unsurprising, contractors have responded by holding on to workers they otherwise might part with; industrywide layoffs are down by 56,000 year over year, and the layoff rate remains lower than in any month on record prior to 2020,” Basu said. His assessment paired falling layoffs with the possibility that voluntary turnover was tightening the available labor pool.

The figures describe two simultaneous trends: voluntary exits reached their highest level since early 2023, while layoffs moved lower from a year earlier. Contractors were keeping more workers even as competition for skilled labor intensified. Basu linked the unusually high quit figure to the possibility of a tighter market.

How did turnover change from August to September?

Construction worker quits numbered 152,000 in August before the September report showed 198,000. The month also recorded a year-over-year decline of 56,000 in industrywide layoffs. Together, the BLS and ABC figures show heavy worker churn without a corresponding rise in layoffs.

ABC also reported that industry job openings increased by 36,000 in September. Openings stood 92,000 above the same month a year earlier, adding to the pool of positions contractors were trying to fill. With more roles available and more workers leaving, contractors faced greater potential demand for the same skilled workers.

What could a worker shortage mean for contractors?

ABC said a worker shortage, if one emerges, could increase costs. Basu warned that reemerging shortages would compound two other pressures already facing contractors.

“Reemerging worker shortages will put upward pressure on labor costs, a dynamic that will exacerbate the effects of high borrowing costs and ongoing materials price escalation,” said Basu. The warning makes labor costs part of a broader squeeze already shaped by financing and materials.

ABC's 36,000 monthly increase in job openings indicates stronger employer demand for workers as quits rose. Basu said the 198,000 quits could signal tighter supply as employers try to fill the new positions. That would put labor alongside financing and materials as a third source of cost pressure.

Does steady employment remove the pressure?

ABC noted that employment across the construction industry was growing steadily compared with a year earlier. ABC's figures show employment expanding even as quits climb, but that growth does not erase Basu's shortage warning. The industry can add jobs overall while contractors still compete for the same skilled workers.

Basu said contractors have responded by retaining workers they otherwise might part with rather than allowing additional layoffs. He also said the 198,000 September quits could signal a tightening labor market even as layoffs were 56,000 lower year over year.

For contractors, the near-term cost test is whether the combination of September's quits and the 92,000 year-over-year gain in openings produces persistent worker shortages. Basu said reemerging shortages would push labor costs higher and compound high borrowing costs and ongoing materials price escalation. If that occurs, contractors would face simultaneous pressure from labor, financing and materials.