The U.S. labor market recently saw a slight uptick in average weekly working hours, which rose by 0.1 hours to 33.7 for production and nonsupervisory workers in July 2025. While this figure may seem minor, it hints at significant shifts in the job landscape, especially in certain industries like construction.
Construction: Growth Amid Changes
Construction is leading the pack. In July 2025, average weekly hours for workers in this sector hit 37.23. The rise is driven by factors like infrastructure spending and urban growth. Historical trends show that construction tends to thrive during major economic shifts, such as urbanization from 1800 to 1999. Notably, the post-WWII infrastructure boom fueled significant job growth, even during tough economic times.
Today’s construction sector benefits from incentives in the Inflation Reduction Act and technology like AI, which improves project efficiency. Since 2020, labor productivity in construction has increased by 2.5% per year, outpacing the manufacturing sector’s pace of 1.2%. Experts suggest that investors should focus on construction stocks, especially those engaged in public-private partnerships and green energy initiatives.
Food Products: Facing Challenges
On the flip side, the food product sector is struggling. According to the Bureau of Labor Statistics, retail trade productivity dropped by 0.4% in 2022, with food and beverage stores seeing some of the biggest declines. Issues such as labor shortages and supply chain bottlenecks have hit profit margins hard. Historically, this sector has lagged during shifts in the labor market, similar to the 1980s transition from manufacturing to services.
With a reliance on low-skill labor, the food industry is especially vulnerable to rising wages. While automation and better inventory management could help, they may not be enough to reverse the challenges. It may be wise for investors to limit exposure to food product stocks and consider alternatives like agricultural equipment or logistics companies instead.
Strategies for Investors
Given the contrasting dynamics in these sectors, here are some actionable strategies:
- Focus on Construction: Look into ETFs like XHB or stocks such as Caterpillar that are linked to infrastructure and green energy.
- Limit Exposure to Food Products: Be cautious with consumer staples unless their valuations seem resilient.
- Take Advantage of Performance Gaps: Historical data shows a 15-20% performance difference between construction and food sectors during labor market changes.
- Stay Informed on Labor Metrics: Keep an eye on productivity and labor cost data provided by the BLS for both sectors.
As labor market dynamics continue to evolve, understanding which sectors are thriving can help shape investment choices. While construction seems poised for growth, the food sector’s struggles highlight the need for careful consideration in portfolio management. Recognizing these trends could offer a significant edge in the coming years.
