Local business cycle severity and induced labour mobility: The case of the construction workforce

The purpose of this study is to examine inter-state labour mobility within the construction industry, a sector of the local/national economy whose output (employment) is highly cyclically sensitive. Econometric estimates of the construction workforce migration decision indicate that such workers are responsive to economic conditions throughout local labour markets when considering geographic mobility. In this regard, workers respond to both static and dynamic measures of local well-being, and choose to move in the face of high local unemployement, slow growth, and high local cycle severity. In the latter respect, migration from metropolitan labour markets is significantly augmented (particularly among the unemployed) by the severity of local job loss attributable to national business cycle contractions, and stemmed somewhat by the rapidity of local job creation attributable to national expansions.The predominance of cycle-induced mobility within the construction workforce (vis-a-vis static local economic conditions) has important implications to both regional and national planners concerned with stabilization aspects of public facility siting (or closure). Thus, such worker responsiveness to local cycle severity should receive significant attention during impact assessment that precedes the construction (or closure) of large facilities such as military bases, public works and nuclear power plants.