California’s Regulatory Landscape and Construction Employment

The ABC analysis points to California’s complex regulatory environment as a key factor contributing to its sluggish recovery in construction employment. These regulations, while often intended to address environmental or labor concerns, frequently drive up project costs and limit the number of viable construction projects. This, in turn, restricts opportunities for economic growth and impacts the availability of skilled trades positions.

Specifically, policies such as project labor agreements (PLAs) and challenges stemming from the California Environmental Quality Act (CEQA) are cited as significant impediments. Morris explained, “PLAs and CEQA-related litigation can unnecessarily inflate project expenses and discourage investment, ultimately leading to fewer construction jobs and higher unemployment rates for skilled workers.”

The construction industry is a vital engine for economic development, and a thriving construction sector is crucial for addressing California’s housing shortage and infrastructure needs. However, the current policy climate presents substantial obstacles to realizing this potential.

Did You Know? California’s construction industry directly employs hundreds of thousands of workers and contributes billions of dollars to the state’s economy annually.

ABC NorCal is actively collaborating with industry stakeholders and policymakers to identify and implement solutions that will foster a more favorable environment for construction growth. These efforts aim to enhance career opportunities, stimulate economic expansion, and reduce the state’s unemployment rate.

What role should state governments play in fostering a healthy construction industry? And how can regulations be streamlined to encourage investment and job creation without compromising essential protections?

For a comprehensive view of national and state unemployment trends, including the impact of the COVID-19 pandemic, explore the data tables and graphing tools available at this link. Further background on calculating state construction unemployment rates can be found here.

Stay informed about the latest construction economic indicators, including the Construction Backlog Indicator and Construction Confidence Index, by visiting ABC’s construction economics news releases.

Frequently Asked Questions About California Construction Unemployment

• What is the current construction unemployment rate in California?

  As of June 2024, the construction unemployment rate in California is 3.9%.

• How does California’s construction unemployment rate compare to other states?

  California’s rate has improved slower than that of 7 other states in the past year, placing it in the bottom 15% nationally.

• What factors are contributing to California’s slower recovery in construction employment?

  Complex regulations, project labor agreements, and CEQA-related lawsuits are identified as key factors increasing project costs and limiting opportunities.

• What is ABC NorCal doing to address this issue?

  ABC NorCal is working with industry leaders and policymakers to create solutions that will enhance career opportunities and economic growth.

• Where can I find more detailed data on construction unemployment rates?

  Detailed state-by-state data and analysis are available from the Associated Builders and Contractors at this link.