A slowdown in the building industry has forced Hawaiian Dredging Construction Co. to cut nearly 10 percent of its work force.

The state's largest construction firm laid off 70 workers last month — the largest one-month reduction since its peak employment of 1,200 workers 18 months to two years ago — as work dried up for its projects, including the completion of Country Club Village 6, a 250-unit residential high-rise in Salt Lake, and slowdown of the 490-unit Moana Vista project in Kakaako.

Hawaiian Dredging has roughly 700 employees after the cuts, which included mostly union workers in addition to salaried supervisors, professional engineers and clerical staff.

The company, which recorded annual sales of $646 million last year, expects revenue to plunge 20 percent to 25 percent for 2008 to nearly $500 million, according to president William Wilson. Less of a drop is expected for 2009.

“;It's the natural ebb and flow of our need for craft labor,”; he said. “;We realize it's the nature of the business, but the fact that it is a part of what we do doesn't make the hard things we do any easier because it is impacting employees — not just our own but subcontractors and others we employ to complete projects.”;

While there is less work being planned in the building sector, it's not so much the case that projects are falling through, but that owners facing difficulties securing credit are delaying them, he said.

While the economic recession has resulted in mass reductions, the building industry's cuts are a continual process, unlike the one-time lay offs at Aloha Airlines, Molokai Ranch and other large businesses, he said. The firm has cut 500 workers from its peak of 1,200 over the last 18 months to two years as part of the cyclical nature of the business.

While there's a potential for further layoffs, the state's effort to accelerate capital improvement projects and the scheduled start of construction of the rail system by the end of 2009 could be a boon to the industry, according to Wilson.

Hawaii's construction labor jobs totaled 39,000 this year, compared to 27,000 in 1998 and a peak of 40,000 in December 2007, according to Karen Nakamura, executive vice president and chief executive officer of the Building Industry Association of Hawaii.

“;When you look at our industry, we're pretty stable,”; she said. “;We don't expect a contraction in construction jobs like we've seen in other industries.”;