No construction manager would even attempt to start building the upper floors of a building…
Looking ahead to 2020 Dodge Data & Analytics released in 2020 Dodge Construction Outlook, which is a mainstay in the industry for business planning and forecasting.
According to the report, which was released at the end of October, new construction starts are expected to slip to $776 billion in the new year, which is a 4 percent decline from the estimated level of activity for 2019.
The chief economist with Dodge Data & Analytics said that the recovery in construction starts that started in 2010 after the Great Recession’s aftermath is ending. After a 3 percent increase in construction starts in 2018, those starts fell 1 percent in 2019.
A Breakdown of the Construction Outlook
- The report indicates that the dollar value of single-family housing starts is expected to fall by 3 percent in the new year and the number of units will lose 5 percent.
- Multi-family construction was an early leader in the post Great Recession recovery, seeing 8 years of growth since 2009. Multi-family vacancy rates have moved sideways throughout the last year, suggesting slower economic growth will affect the construction market next year. They expect multifamily construction to drop 15 percent in units and 13 percent dollar-wise.
- Commercial building starts will drop 6 percent as far as dollar value goes.
- Institutional construction starts will remain even with the level it saw in 2019.
- Public works construction starts will move up 4 percent seeing growth across all the project types.
- Construction projects for electric utilities and gas plants will drop 27 percent after seeing 83 percent growth in 2019.
However, despite the drops in new construction projects, the demand for those who work in the construction industry is continuing to climb. The Bureau of Labor Statistics expects an 11 percent growth in the employment of construction workers from 2018 to 2028.