Gilbane Building Company today announces the publication of the Spring 2013 edition of Construction Economics – Market Conditions in Construction. Based on an array of economic data, construction starts, and material cost trends, the data is the most positive the company has seen in recent years.
“We are in a growth period that by all leading indicators seems here to stay. From 2006 to 2010, as work declined, we saw the largest decline of margins in recent history. In 2011 that trend began to reverse slightly” says Ed Zarenski, the report’s author and a 40-year veteran of the construction industry. “I expect the positive growth to continue.”
According to the report, the monthly rate of construction spending is up 20% in 24 months and increased in 18 of the last 24 months, which is a good leading indicator for new construction work in Q3-Q4 2013.
Other highlights include:
- Residential spending will take the lead in 2013, nonresidential spending will lag.
- Public spending will decline. Private spending will lead the charge in 2013.
- As spending continues to increase, even moderate growth in activity will allow contractors to pass along more material costs and increase margins. When activity picks up in all sectors, escalation will begin to advance rapidly.
- Predicted spending growth of 8.2% for Commercial markets, 5.2% for Office and 2.3% for Healthcare.
Construction jobs grew by 150,000 in the last five months. Just to meet the needs of the predicted residential building expansion, the workforce needs to grow by 750,000 jobs in the next two years, faster than the entire construction workforce has ever grown in history.
Future escalation, in order to support labor growth, materials demand and to capture increasing margins, will be higher than normal labor/material cost growth. Lagging regions may take longer to experience high escalation. Residential escalation will be near the upper end of the range.
This free report and its executive summary are available for download at http://www.gilbaneco.com/economic-report.
About Gilbane, Inc.
Gilbane provides a full slate of construction and facilities-related services – from pre-construction planning and integrated consulting capabilities to comprehensive construction management, close-out and facility management services – for clients across various markets. Marking its 140th year in operation and still a privately held, family-run company, Gilbane has more than 60 office locations around the world. To find out what the next 140 years have in store, visit www.gilbaneco.com.
Related Stories
| Jan 14, 2016
How to succeed with EIFS: exterior insulation and finish systems
This AIA CES Discovery course discusses the six elements of an EIFS wall assembly; common EIFS failures and how to prevent them; and EIFS and sustainability.
Market Data | Jan 13, 2016
Morgan Stanley bucks gloom and doom, thinks U.S. economy has legs through 2020
Strong job growth and dwindling consumer debt give rise to hope.
Architects | Jan 13, 2016
‘Socially engaged’ architect Alejandro Aravena named 2016 Pritzker Architecture Prize Laureate
Known for his inventive social housing initiatives in his native Chile, Aravena epitomizes the revival of a more socially engaged architect, the Pritzker jury stated.
Architects | Jan 12, 2016
Dear Architecture: It's time to create a level field for female designers
If architecture took one moment to be introspective, it would discover appalling imbalances between the opportunities for women and men, as Perkins+Will's Vershaé Hite and Brittany Eaker-Kirkland wrote in an open letter.
Great Solutions | Jan 6, 2016
Shepley Bulfinch develops elegant design solution to address behavioral issues in emergency departments
ED scheme allows staff to isolate unruly patients and visitors in a secure area.
Market Data | Jan 5, 2016
Majority of AEC firms saw growth in 2015, remain optimistic for 2016: BD+C survey
By all indications, 2015 was another solid year for U.S. architecture, engineering, and construction firms.
Architects | Jan 5, 2016
Potential vs. credential: How men and women differ in career progress
Recent research suggests that women face yet another career impediment: the confidence gap.
Architects | Dec 17, 2015
Capturing utilization and activity data in the workplace
While utilization is an important metric to inform how frequently a space is used, it’s important to consider activity data.
Architects | Dec 17, 2015
Four winners named in NYC sidewalk shed competition
Firms in the Construction Shed Design Competition made designs that are simple to build and use readily-available materials.
Architects | Dec 16, 2015
Lohan Anderson to close, join Wight & Co.
Dirk Lohan, Floyd Anderson and eight others will be hired by the Illinois-based Wight & Co. next month.
