The impact of the recession on construction jobs is very regional. Only two regions escaped any impact. The northern plains escaped due to sustained high farm income, natural gas expansion and large state budget reserves. The Gulf States escaped to the much delayed federal Katrina funds. The impact in the Northeast is relatively small although the negative impact may persist longer. Scheduled projects in this region were heavily replacement or upgrade instead of space expansion and heavily institutional rather than commercial. Hence their financing was more solid. Also Pennsylvania and New York had some natural gas field expansion.

The biggest negative impacts were in previously rapidly growing states where scheduled projects were heavily developer financed and hence had less secure financing. These state disparities will likely widen into early next year because of the recent drop in starts for developer financed projects. During the second half of 2010, the expected pickup in commercial work and housing means that construction job growth will be the most rapid in the states where the decline has recently been steepest.

The construction jobs recovery in the border states and Florida will lag other growth regions such as the mid-South, the northern Rocky Mountains and the Pacific Northwest. Growth in the border states and Florida was very dependent on foreign immigration which will rebound slowly in a more difficult legal environment. Also, these states have suffered a substantial loss of immigrants back to Latin America so they will have more vacant space to absorb. And their regional banks that finance small and mid-size projects are now much weaker than banks elsewhere in the country because of mortgage defaults.

Michigan, Ohio and Indiana are likely to recover relatively quickly by late next year because their auto and machinery industries will be expanding much faster than the rest of the economy.

The impact of spending the remaining stimulus construction funds will have a distinctly different regional jobs impact than the natural evolution of the business cycle.

There is still $50-60 Billion of stimulus money yet to be allocated to specific building and facility projects. The location of these projects will not be known until a variety of competitive grant processes are completed. Generally, this work will start in 2010 and will still be underway in 2011-12. This money will be distributed differently than developer money. The stimulus funds will almost certainty be concentrated in urban states with the Southwest, The Rocky Mountains and the South Atlantic getting a smaller share than they get from private developers.