Employment in Skilled Trades Drops

WASHINGTON -- Nearly 1.4 million specialty trade (or subcontractor) employees left the industry between 2006 to 2011, the Bureau of Labor Statistics reports, a trend the National Association of Homebuilders finds alarming. Specialty trades are essential to both the residential and commercial construction industries, the association says.

Despite the drop in the number of specialty trade employees, annual statistics for nonemployer firms (one-person firms) have been much less volatile during the same period, association figures show.

Specialty trades, also called skilled trades, include masons, plumbers, painters, electricians and other subcontractor lines of work. In a report released to news organizations, the association’s Josh Miller Monday highlighted the difference in volatility between employees of subcontracting companies and one-person firms as well as the importance of considering both employees and one-person firms.

A one-person firm has no paid employees and is subject to individual federal income taxes rather than corporate rate, he notes. In 2012, average receipts for specialty trade one-person firms were just over $47,000. The relatively small size suggests one-person firms do not have significant fixed costs and hence these firms are likely more flexible during an economic downturn. The decline in one-person firms is less severe than employment within multi-employee firms.

The peak for multi-employee firm employment occurred in 2006 when they employed just over 4.9 million. The number of specialty trade employees today stands at just more than 3.5 million. The peak for one-person firms occurred in 2007 with just over 1.9 million such firms. That figure stands at just under 1.7 million today.

Year-over-year fluctuations shows similar lower volatility in one-person firms versus company employment. Employment in multi-employee firms fell 12.2% from 2007 to 2008 and 19.4% from 2008 to 2009, while one-person firms declined by 5.4% from 2007 to 2008 and 3.7% from 2008 to 2009.

Published by The Business Journal, Youngstown, Ohio.
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