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Construction Industry Continues Strong Growth in 2018

By July 18, 2018Industry News
Construction Industry Continues Strong Growth in 2018

Having a strong construction industry means that you will receive a high level of service on your projects because firms are fully staffed and have access to ready sources of supplies. Fortunately, the U.S. construction industry continues on an upward trend according to several recent reports.

 

Where is U.S. Construction at Today?

According to Dodge Data & Analytics, U.S. Construction starts were up 15% in May, following a 12% decline the prior month. A catalyst for much of those gains was new starts in nonresidential building and public works construction, with nonresidential building up 39% from April’s numbers.

Some major nonresidential building projects that helped boost these figures were the groundbreaking of a $1 billion Facebook data center in Nebraska, the start of Washington State’s $764 million convention center, and a $740 million Salt Lake City International Airport terminal project.

Even though the construction sector is facing some challenges, such as higher interest rates and elevated materials prices, this has not yet produced any lasting impact on the momentum that the industry has created so far this year. In fact, the new Dodd-Frank Reform legislation that rolls back some banking restrictions is going to make it easier for some regional banks to lend to eager borrowers.

Construction employment is also on the upswing in 2018. In June, the industry added 13,000 new jobs. The annual increase in construction jobs in the U.S. is 4.1% as of June, or more than 282,000 new positions.

 

The Future of U.S. Construction in 2018 Looks Bright

The Equipment Leasing and Finance Foundation just released an industry outlook report that is bullish on the construction sector for 2018. Called the “Vertical Market Outlook Series – Construction,” the report predicts that this sector will continue to grow. Specifically, it highlighted record spending in the construction industry in 2017 and states that the industry should grow by as much as another 5% this year.

The report notes that both consumer and small business confidence were up going into 2018. Reviewing Wells Fargo’s Equipment Finance division’s 2018 Construction Industry Forecast, there is also positive sentiment regarding equipment rentals and sales as well as net profits within the industry. According to this report, 73% of contractors said that they planned to expand their operations within the next two years.

While 5% overall growth in construction is expected this year in the U.S., the results will vary depending on geography. For example, construction in the Houston and Dallas areas is expected to jump 14% and 10% respectively. New York City, on the other hand, is expected to see a contraction of 2% in construction spending.

 

The construction sector continues to evolve with each passing year. Some of the overriding industry trends that this latest report noted include:

Resiliency.

This refers to structural and site features that will allow devastated property owners to weather future fires, earthquakes, floods, and hurricanes.

Labor Shortages.

Despite the growth, the industry still struggles with a labor shortage.

Technology.

The building industry is making greater use of technology for design, management, construction, and integration for smart buildings.

Policy.

The construction industry continues to be wary of changing policies that will impact its ability to serve clients, such as tariffs, tax reform, and other legislation.

 

Contact K-Con for Your Next Design-Build Project

Whether you are a government entity or a commercial business, K-Con can help with your next pre-engineered construction project. We specialize in metal buildings using design-build concepts, meaning we will be with you from concept through construction.

Our projects offer competitive pricing, fast completion times, and some of the most durable and flexible building systems on the market. Contact us now to get the conversation started on your next project. Ask about our policy for quick turnaround on preliminary drawings and pricing.