Residential or non-residential?
This is something that came to my attention when I was discussing it with others Joe Schultz. Without hard data specific to the Wisconsin level (that I know of), it's hard to say.
What coincides with the construction surge? It's not so much the housing starts, it's the CHIPS Act and the Inflation Lowering Act.
figure 1: Midwest residential starts single-family homes, million, nsa (blue, left axis), Wisconsin construction industry, million, 2017 USD, SAAR (tan, right axis). Source: Census, BEA.
Real construction value added in Wisconsin rose sharply immediately after the passage of both pieces of legislation, while housing starts will not begin to rise until the second quarter of 2023.
An examination of employment types in construction further suggests that certain types of nonresidential investment are driving employment.
figure 2: Wisconsin 12-month employment changes in construction (cyan), heavy and civil engineering (tan), specialty trade contractors (green), and construction equipment contractors (red), not seasonally adjusted. Source: DWD and author's calculations.
I think heavy and civil engineering is more relevant to building factories and infrastructure (related to manufacturing and alternative energy) than it is to residential.
We do have a breakdown of construction workers in residential and nonresidential employment across the country.
image 3: Nonresidential construction employment (blue), residential construction employment (tan), both 000s, sa Source: BLS via FRED.
Clearly, nonresidential construction employment is growing rapidly, while residential construction employment has only recently picked up (4% versus 1% annually).
