January means it’s time for a look what to expect in the upcoming year. Jeff Gavin dives right in, with the 2017 Construction Outlook in the latest issue of ELECTRICAL CONTRACTOR Magazine.
View the Full 2017 Construction Outlook Report
A brief summary of the report:
“A recovery now seven years and counting has moved incrementally, allowing some construction sectors to fully recover and others to move near post-recession levels. Some sectors will remain nearer to those post-recession levels than others” in 2017, he writes.
Additionally, Gavin highlights:
- According to Dodge Data & Analytics, total construction starts as of September 2016 increased 1 percent ($676 billion), building off an 11 percent spike in 2015 (see Figure 1). Taking out the influence of the poorly performing utility/gas plant market, growth translated to 4 percent.
- Residential rose 7 percent, nonresidential decreased 3 percent, and nonbuilding dropped 10 percent. Nonbuilding is public works, electric utilities and gas plants. A sharp drop from a strong 2015 among utilities—gas plants in particular—pulled down this sector.
- Looking to this year, construction starts are forecast to rise to 5 percent ($713 billion), though closer to 8 percent without nonbuilding. That equates to an 8 percent gain in both residential and nonresidential, and a 3 percent decline for nonbuilding.
Gavin also writes that “single-family housing may be a sector to watch.” Furthermore, he adds, the National Association of Home Builders’ Housing Market Index showed a bullish outlook by home builders described as “the strongest market in 11 years” and “the strongest spring housing markets in a decade.” On the commercial side, Gavin writes, future growth looks “a bit modest.”
One seemingly obvious point that Gavin makes is that “where you live affects how the recovery feels.” He writes: “Former heavy manufacturing belts and energy regions affected by low oil prices or decreasing demand for coal remain discouraged. A more evenhanded recovery may require deeper infrastructure spending and better support for trade education, especially as applied to new energy and the labor-stressed construction trades.”
Gavin concludes by noting that “there is still fuel in the tank in an expansion yet to peak.”
“Expect to see gains and progress of varying degrees across all construction sectors this year,” he writes.
View full report in the January issue of ELECTRICAL CONTRACTOR or, at ECMag.com »