FMI, the largest provider of management consulting and investment banking to the engineering and construction industry, announces the release of the Construction Outlook: Third Quarter 2011 Report.
Overall, in FMI’s latest forecast for construction put in place calls for 2% growth in 2011 and 6% for 2012 to $886.2 billion in total construction. In today’s economy that sounds like ambitious growth, but in constant 2006 dollars, that is only 3% growth for 2012 and a 1% drop in construction for 2011. To put it in perspective, in 2012 we will nearly return to 2003 levels of construction in current dollars.
Despite geo-political upheavals and constant debates about debt levels in the U.S. and Europe, budget brinksmanship in Congress, as well as a rash of natural disasters, construction markets are inching along. U.S. GDP is slow at 1.3%, but positive. Some of the unemployment problem is due to increased productivity in manufacturing and other service businesses, but, so far, there doesn’t seem to be much innovation and investment in new markets and jobs. Both consumers and businesses are rebuilding their savings and confidence in the economy, but that is a slow process with numerous setbacks. It seems that the largest barrier to moving the economy forward is fear that no one has a plan that will work. After the go-go years of high finance and exuberant housing markets, we now have high-risk aversion, and not without good reasons.
In the midst of these extremes, the inchworm economy is struggling along, and it will take some time to revive an industry the size of U.S. construction. There are positive signs to build on, for instance, if businesses with record profits now held in reserve decide that they can make more with their money by investing in new R&D, plants, equipment and personnel, then a new construction boom could follow. On the other hand, as economists like to say, if fear and risk aversion win out, those looking for a second dip of recession could find their wishes come true.
Hard-hit residential markets will start to improve, especially multi-family construction, which is becoming more desirable as banks continue to tighten financing requirements and homeowners are still reeling from the fears of foreclosure. Lodging, office and commercial construction will continue to struggle until more Americans have good jobs. BD+C
Related Stories
K-12 Schools | Apr 10, 2024
Surprise, surprise: Students excel in modernized K-12 school buildings
Too many of the nation’s school districts are having to make it work with less-than-ideal educational facilities. But at what cost to student performance and staff satisfaction?
Industrial Facilities | Apr 9, 2024
Confessions of a cold storage architect
Designing energy-efficient cold storage facilities that keep food safe and look beautiful takes special knowledge.
Cultural Facilities | Apr 8, 2024
Multipurpose sports facility will be first completed building at Obama Presidential Center
When it opens in late 2025, the Home Court will be the first completed space on the Obama Presidential Center campus in Chicago. Located on the southwest corner of the 19.3-acre Obama Presidential Center in Jackson Park, the Home Court will be the largest gathering space on the campus. Renderings recently have been released of the 45,000-sf multipurpose sports facility and events space designed by Moody Nolan.
Green | Apr 8, 2024
LEED v5 released for public comment
The U.S. Green Building Council (USGBC) has opened the first public comment period for the first draft of LEED v5. The new version of the LEED green building rating system will drive deep decarbonization, quality of life improvements, and ecological conservation and restoration, USGBC says.
Codes and Standards | Apr 8, 2024
Boston’s plans to hold back rising seawater stall amid real estate slowdown
Boston has placed significant aspects of its plan to protect the city from rising sea levels on the actions of private developers. Amid a post-Covid commercial development slump, though, efforts to build protective infrastructure have stalled.
Sustainability | Apr 8, 2024
3 sustainable design decisions to make early
In her experience as an architect, Megan Valentine AIA, LEED AP, NCARB, WELL AP, Fitwel, Director of Sustainability, KTGY has found three impactful sustainable design decisions: site selection, massing and orientation, and proper window-to-wall ratios.
Brick and Masonry | Apr 4, 2024
Best in brick buildings: 9 projects take top honors in the Brick in Architecture Awards
The Ace Hotel Toronto, designed by Shim-Sutcliffe Architects, and the TCU Music Center by Bora Architecture & Interiors are among nine "Best in Class" winners and 44 overall winners in the Brick Industry Association's 2023 Brick in Architecture Awards.
Retail Centers | Apr 4, 2024
Retail design trends: Consumers are looking for wellness in where they shop
Consumers are making lifestyle choices with wellness in mind, which ignites in them a feeling of purpose and a sense of motivation. That’s the conclusion that the architecture and design firm MG2 draws from a survey of 1,182 U.S. adult consumers the firm conducted last December about retail design and what consumers want in healthier shopping experiences.
Healthcare Facilities | Apr 3, 2024
Foster + Partners, CannonDesign unveil design for Mayo Clinic campus expansion
A redesign of the Mayo Clinic’s downtown campus in Rochester, Minn., centers around two new clinical high-rise buildings. The two nine-story structures will reach a height of 221 feet, with the potential to expand to 420 feet.
Sports and Recreational Facilities | Apr 2, 2024
How university rec centers are evolving to support wellbeing
In a LinkedIn Live, Recreation & Wellbeing’s Sadat Khan and Abby Diehl joined HOK architect Emily Ostertag to discuss the growing trend to design and program rec centers to support mental wellbeing and holistic health.