While construction spending in the United States may have gotten off to a slow start in 2013, it hit a near 4-1/2 year high in August (according to Reuters), and analysts foresee steady growth in construction spending for the remainder of the year and well into 2014 and 2015.
In economic summit last month hosted by Reed Construction Data (RCD) and titled “The 2014 Outlook: Emerging Opportunities for Construction,” key presenters—including AIA chief economist Kermit Baker and AGC America chief economist Ken Simonson, along with RCD chief economist Bernard Markstein—looked at the current U.S. economy and the factors affecting spending growth. They agreed that even in the face of current challenges, the outlook for construction growth remains positive.
“Despite several potential pitfalls facing the economy this fall and beyond, including the shutdown and debt ceiling dilemma, many forecasters are projecting a turn-around for construction in 2014,” stated Markstein in a press release about the summit. He and his fellow presenters predicted a rise in spending on both public and private construction projects over the next two years.
According to the presenters, we can expect to see growth in several key areas. Simonson forecasted 5% to 10% growth in private nonresidential spending, specifically for manufacturing, warehouse, data centers; remodels of hotels, office, retail; and flat power, health care, private education. Continued recovery is also expected in both the single-family and multi-family housing markets.
The Need for Skilled Workers and the Value of Training
While promising, the expected rise in construction spending brings with it the need for more skilled workers. As older, experienced workers continue to retire in large numbers, employers must find ways to attract a new generation of professionals. In addition, many of the new jobs available require a higher degree of skill due to advancements in technology and automation. In his presentation, Simonson presented findings from the August 2013 AGC Worker Shortage Survey, which revealed the hardest positions to fill were:
Professional – any 53%
Project managers/supervisors 49%
Craft – any 74%
Equipment operators 31%
Construction industry employers as well as licensed and non-licensed professionals would be wise to focus on the value of ongoing training to improve productivity and performance. A strong onboarding program and workplace-provided continuing education that focuses on technical skills as well as leadership and management training will provide key opportunities for success now and in the future.