2017 Construction Outlook – Experts Anticipate Growth
The construction industry is optimistic about 2017, according to a recent survey by Associated General Contractors of America, with 73 percent of the construction firms surveyed planning to hire more employees
this year in anticipation of growth in both the public and private sectors. As it looks now, we might want to call it a Trump Bump … with the new president’s promises to invest in the country’s infrastructure, cut regulations, revise Obamacare and other business-friendly initiatives.
No surprise, but the top concern of construction firms continues to focus on staffing – 55 percent of respondents indicate worker shortages as their main challenge, and 46 percent say worker quality.
Dodge Data & Analytics, a leader in construction industry forecasting, reports that 2016 saw just 1% growth for total U.S. construction starts. But the good news … they're predicting a 5% increase in 2017, which translates to $713 billion.
Residential – multi-family units continue to be strong, but slowing down from the recent boom. Single-family new construction is on the rise, coming back to pre-2010 levels. Interestingly, while millennials have tended to prefer renting multi-family dwellings in urban areas, experts are seeing that as they marry and start a family, more and more are heading for the suburbs and creating demand for single-family homes. A challenge for all residential construction is the expiration of the Softwood Lumber Agreement with Canada, which could mean higher building costs.
Retail and Warehouses – consumer confidence is up, and thus so is retail spending. Despite the increase in online sales and decline of some brick-and-mortar stores, traditional retail construction remains strong, trending toward more experience-based and destination shopping sites. Thanks to the increase in online sales and the overall growth of retail, warehouse construction should show solid growth.
Green Building – the U.S. Green Building Council reports that the green building sector is outpacing overall construction growth and will continue to rise. They expect that by 2018, green construction will directly contribute 1.1 million jobs and $75.6 billion in wages in the United States. LEED building construction projects are estimated contribute 386,000 jobs and $26.2 billion in wages by 2018.
Remodeling – spending nationwide for home improvements and repairs continues to rise. According to Harvard’s Leading Indicator of Remodeling Activity (LIRA) report, we should see an increase of 6.7% to reach $317 billion in 2017. Rising mortgage interest rates will likely affect this sector, as many homeowners opt to remodel instead of purchase a new home.
So it looks like 2017 will be a successful year for our industry. At Dunn-Edwards we are planning to open many new company retail stores and qualified dealers. Our R&D teams are continually improving our paints and primers, and our sales specialists strive to provide you with excellent service. We thank you for your business, and look forward to a fantastic 2017.