The 2001 projection for the construction industry remains positive. While the industry has been extremely successful over the past few years, no expansion can continue endlessly. Construction spending for next year will rise by a little more than 1 percent as a result of increased interest rates and oil prices and a cooling economy.
Although growth will occur at a slower rate than in 1999 and 2000, the 10-year cycle beginning with 1991 is still at an astounding high. Despite a slower rate of growth, the level of activity will remain close to the 3 percent increase that was seen in 2000. Next year's slight increase translates into a 2 percent constant dollar decrease, but still leaves activity at a higher level than it was during most of the 1990s.
The length and strength of the U.S. economic expansion has lessened the volatility of construction activity and allowed for growth in several sectors. This bodes well for certain areas of private nonresidential construction, including schools and manufacturing facilities, which should remain at around 4.5 percent.
Public construction, including utilities, will rebound next year by approximately 4 percent, with transportation as the sector leader.
Labor markets will remain tight. Although construction is among the highest paying industries, skilled workers are still in demand. The U.S. Department of Labor forecasts a 9 percent growth in the construction labor market for 2001, with a long-term projection of nearly 7 percent overall labor increase for the industry by 2008. A marked need for sheet metal workers, excavation machine operators and HVAC installers are reasons why AGC heavily promotes its "Construction Futures" campaign. The project grew out of the need to enhance the industry's image so that more children would consider the construction industry as a career choice.
