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80 • ROCK products • August 2018 www.rockproducts.com without construction experience, as the pool of unemployed construction workers has nearly evaporated." Construction employment totaled 7,222,000 in June, the highest level since May 2008 and a gain of 4.1 percent over the past 12 months. The economist pointed out that the year- over-year growth rate in industry jobs was more than double the 1.6 percent rise in total non-farm payroll employment. Hourly earnings in the industry averaged $29.71 in June, an increase of 2.9 percent from a year earlier. That put average hourly earnings in construction 10.1 percent higher than the average for all nonfarm private-sector jobs, which rose 2.7 percent in the past year, to $26.98, Simonson added. The unemployment for workers with construction experi- ence in June was 4.7 percent, virtually unchanged from the levels in June 2017 (4.5 percent) and June 2016 (4.6 per- cent) – a sign that the industry is operating at essentially full employment, Simonson said. Employment in residential construction – comprising res- idential building and specialty trade contractors – grew by 4,400 jobs in June and by 133,800 jobs over the past 12 months, a 5.0 percent increase. Employment in nonresiden- tial construction – including building, specialty trades, and heavy and civil engineering construction – grew by 8,600 jobs in June and by 147,900 during the past year, a 3.5 per- cent increase. Association officials observed that construction employers appear more eager to hire amid lower taxes and increased efforts to reduce needless or ineffective regulatory burdens. They added that recent increased infrastructure invest- ments at the federal and state level are also helping boost construction employment. But they cautioned that workforce shortages, tariffs and a looming trade war could undermine future construction employment gains. "The steps Congress and the Trump administration have taken to create a more positive business environment and boost employment appear to be working," said AGC's. "But new trade disputes and chronic underfunding of career and technical education programs pose a real threat to continued employment gains in the sector." Tariffs Hit Construction Market Construction costs accelerated again in June, with steep increases for a wide range of building and road construction materials as tariffs against foreign goods come into effect, according to an analysis by AGC of new Labor Department data. Association officials say that contractors will have to assume much of the costs as tariffs increase the costs of many key construction materials. "Contractors' costs for a wide range of materials and ser- vices have escalated dramatically in the past few months, putting a squeeze on profits and dimming the outlook for both public and private projects," said the association's chief economist, said Simonson, noting that the U.S. imposed steel and aluminum tariffs on imports from Canada, Mexico and the European Union on May 31 and has since announced over $200 billion in tariffs on Chinese goods. "Tariffs that took effect or have been announced since this price data was col- lected will push costs up even more." The construction economist noted that the producer price index jumped by 20.0 percent for aluminum mill shapes, 17.4 percent for copper and brass mill shapes and 12.3 percent for steel mill products between June 2017 and June 2018. Other construction inputs that rose sharply in price from May 2017 to May 2018 include diesel fuel, 52.8 percent; lumber and plywood, 18.3 percent; asphalt felts and coatings, 7.5 percent; ready-mixed concrete, 5.5 percent; and paving mixtures and blocks, 5.0 percent. "Many of these increases far outstripped the 4.3 percent rise in the price index for new construction – what contractors are charging to build projects, implying that contractors' profit margins are shrinking as they absorb some of the increased costs," Simonson added. The producer price index for inputs to construction indus- tries, goods – a measure of all materials used in construction projects including items consumed by contractors, such as diesel fuel – rose 9.6 percent over 12 months. The year- over-year increase was the steepest since October 2008, Simonson noted. Association officials say the new tariffs are putting new cost pressures on many construction firms. As many firms strug- gle to cope with rising materials prices they will have less capital available to invest in personnel – especially as labor costs continue to climb. And firms will have less money avail- able to invest in technologies that can make the construction process more efficient. "The broader impact of the new tariffs and the trade fights that are now emerging is a significant and costly loss in productivity for many construction firms," said Sandherr. "Making real, sustained and long-term investments in our aging and over-burdened infrastructure will do more to boost domestic production of strategic resources without exacting lasting damage on construction firms and the high- wage jobs they offer." Machinery used by aggregates operations is on a list of Chi- nese imports that are subject to a 25 percent duty beginning July 6, according to the National Stone, Sand and Gravel Association (NSSGA). The United States Trade Representa- tive (USTR) announced a list of Harmonized Tariff Schedule (HTS) codes that classified hundreds of goods subject to the increased tariff. The list includes seven entries under subheading 8474, which Aggregates Industry Almanac Economic Update