Construction Builds On Self-Employment
More than one in four construction workers are self-employed, and the numbers have trended up since the recession.
The construction industry has always been known for employing a high share of self-employed workers. Builders and remodelers commonly maintain small payrolls and rely on subcontractors for a large share of the heavy lifting.
Now a new study is adding credibility to common knowledge. According to the 2010 American Community Survey (ACS), more than 26 percent of workers in construction are self-employed, making it the second-highest self-employing industry in the nation. Only agriculture has a higher share, close to 34 percent. The national average for all industries is 10 percent.
Tellingly, self-employment rates in the construction industry started to rise during the housing downturn, increasing from 24 percent in 2006 to 26 percent nationally in 2010. Builders and remodelers without a steady workflow likely eliminated payroll positions to manage costs, and forced staff to strike out on their own among the ranks of the self-employed.
During the same period the national self-employment rate fell from 11 to 10 percent, and self-employment in agriculture declined from 41 to 34 percent. Moreover, states hit hardest by the housing downturn – Florida, California, Nevada, and Arizona – registered some of the highest jumps in construction self-employment rates.