After several very lean years, the construction industry appears to be bouncing back in 2013. With spending being at a rate of 6.6% higher than this time last year, businesses are beginning to show enough faith in the economy to let the industry begin its journey of growth. Continuing to add jobs at a steady pace, last month construction added almost 18,000 jobs and has added over 94,000 jobs so far this year. Since September 2012, over 169,000 construction jobs have been added to the economy, making it one of the fastest-growing employment areas.
One of the major points of interest when it comes to construction is the number of new home starts, and this is also continuing to rise. The residential construction market has been rising the past several months, with new home starts rising 7 percent between February and March of this year. Currently increasing at a rate that’s 47% higher than this time last year, this is one of the best and most reliable indicators of the industry’s strength.
Take It From The Pros
Another strong indicator of how well the industry is doing is what construction company executives are saying. In a recent poll conducted by Construction Data Company, half of all respondents indicated their companies are better off than last year, and expect to be hiring new workers throughout the course of the year. Also, 61% stated they felt their business was in better shape now than it was before the Great Recession and that it would be even better six months from now. These results usually spell good news for the industry, because general contractors, specialty contractors and building materials suppliers base much of what they do on the results of this survey.
The Numbers Don’t Lie
For seven consecutive months the Architecture Billings Index has risen, which is a good sign for nonresidential construction. With a score of 54.9, it indicated the strongest growth since early 2008. With a score of 50 indicating no change, a score this far above that figure indicates strong growth is expected throughout the year. Nonresidential construction activity usually follows these results over the following year, indicating much confidence is being expressed by architectural firms.
Here Comes The Boom
With the federal government’s plans for fixing the nation’s infrastructure, many experts believe the construction industry is poised for an unprecedented boom not seen since the days of the Great Depression, when FDR created the Civilian Conservation Corps and other groups to put people to work building and repairing many aspects of the country. With bridges, buildings and roads all in dire need of repair, experts feel now is the time to expect huge growth in many sectors of the industry.
The only negative experts see is the potential effects of the sequestration. This could impact federal funding of projects that usually go down to the state and local levels, resulting in less money being made available to construction firms who specialize in projects that are mostly federally funded. However, overall the industry looks ready to be as strong as ever, with workers being hired to tackle various projects.
About the Author
Jason Kane is a former construction foreman and avid blogger. Jason writes for Fall Protection USA, a provider of construction safety equipment.