Middle schools, high schools, and cultural facilities lead education spending
The value of education construction starts increased 17.7% during the first nine months of 2006 compared to the same period last year, according to Reed Construction Data. Rapidly growing project sectors include middle schools; high schools; private K-12 schools; and cultural facilities, such as libraries, museums, and galleries, which the U.S. Census Bureau reports under education subtotals.
The demographic enrollment bulge is now in the ninth grade so spending for both middle and high schools will continue to be relatively strong through 2008.
The weaker markets—elementary schools and private higher education facilities—are expected to remain weak through 2008, although spending by private colleges will pick up at the end of the economic expansion cycle, as usual.
Education construction spending stalled about halfway through 2006 when rising material costs forced some projects to be slowed or postponed. The outlook for 2007-08 is better, with an annual growth rate of nearly 10% forecast. The growth will be fueled by a slowdown in material cost inflation, improved state budget balances, and a surge in new project starts.
Current job site spending is about 15% higher than a year ago.