The State Of The Construction Industry In 2014 And Beyond
The construction industry has had to labor under an unfavorable economy for many years now, but some industry experts believe that 2104 is the year when it will all turn around. Although the state of the construction industry in the coming years will largely depend on its performance in the latter part of 2013, there are indications that more construction projects are forthcoming over the next few years.
New opportunities in the commercial construction industry
Heidi Schwartz of “Today’s Facility Manager” is particularly optimistic of the direction that the construction industry is heading, citing the improvements that marked 2013. She is especially excited about the continued growth of the commercial construction industry, which registered an increase in employment rates during the middle of the year. In June of 2013, almost 6 million workers signed on to the construction industry, contributing significantly to the economy.
Other individuals and organizations share in Schwartz’s optimism. The consulting firm FMI is one such company, and it expects an 8% growth in the commercial construction industry in 2014, after it failed to register a significant growth in 2013. There are even indications that spending will increase in the following years, creating new opportunities in what is now being termed the “rebounding” construction markets. With this period of renewed growth, the construction industry is poised to register significant growth after the long financial crisis that nearly crippled the industry. With widespread expansion in the home and commercial construction fronts, FMI and other industry observers predict a period of renewed growth for the construction industry.
2014: A Period Of Accelerated Growth
Other observers are even more optimistic of the state of the construction industry in 2014. In a webinar produced by Reed Construction Data entitled “Riding the Roller Coaster: Ups and downs in construction, spending, materials and labor”, it was predicted that the construction industry would undergo a period of accelerated growth in the coming year. Chief economist at Reed, Bernard Markstein said that the commercial construction industry registered a significant turnaround in 2012, and is “expected to continue to improve”. Markstein admitted that the industry has struggled in the nonresidential building front, but that better performance is expected toward the latter part of 2013 and throughout 2014.
The observations made by economists at Reed Construction Data are particularly significant given the firm’s reputation for accurate leads and market data. The company is considered one of the most reliable sources of construction information in the industry, having recently provided key insights into the construction industry early in 2013. Reed had then gathered data on construction expenditures from 2005 to 2012, and deduced that there were significant changes in construction spending as well as how construction funds were allocated. Based on their analysis, Reed economists reported a 23% decrease in total construction expenditure, with most of the funds allocated to nonresidential construction projects. With the period of renewed growth toward the end of 2013 and throughout 2014, it is expected that most of the construction budget for the coming year will be allocated to projects in the commercial, office, education, and manufacturing sectors.