The Associated Builders and Contractors’ (ABC) 2011 economic forecast for the U.S. commercial and industrial construction industry offers hopeful news for several segments of the construction industry.
According to ABC Chief Economist Anirban Basu, the nonresidential construction recession is largely over, but 2011 will be associated with grudgingly slow progress.
“To the extent that there has been recovery in nonresidential construction, it has been concentrated in segments closely tied to federal funding and the stimulus package passed in the midst of the recession,” Basu said. “For example, five nonresidential construction categories monitored by the U.S. Census Bureau have experienced rising spending levels from the same time last year, including conservation and development, water supply, sewage and waste disposal, highway and street, and transportation.”
For the first time in six months, the nation’s construction industry added jobs in February. According to the March 4 employment report by the U.S. Labor Department, 33,000 jobs were created. The construction unemployment rate stands at 21.8 percent, twice the national average. However, unemployment is down from 22.5 percent in January and down from 27.1 percent the same time last year.
As growth continues, demand for a highly trained, highly skilled work force will rebound. Trainees and apprentices in the education pipeline now in programs such as the San Diego Apprenticeship Training Trust will have an excellent opportunity to seize new employment opportunities when the industry begins hiring again on a broader basis in the near future.
The nonresidential construction employment forecast remains flat for the immediate future, rebounding in 2012. However, ABC predicts that residential construction employment will grow substantially, as the number of housing starts will expand by roughly 25 percent.
The good news is the period of deep decline in U.S. nonresidential construction spending is over. ABC expects that 2012 will be better for privately financed construction. Certain leading indicators have turned the proverbial corner, including ABC’s Construction Backlog Indicator, which has been indicating a steady improvement in the commercial and industrial construction outlook.