There’s some not-so-welcome news for the construction industry. In fact, it’s expected to contract somewhat significantly, as noted by newly released information from the firm Dodge Data & Analytics. “The report predicts that total U.S. construction starts will slip to $776 billion in 2020, a decline of 4% from the 2019 estimated level of activity,” as noted by the publication.
One key factor to blame? The fact that growth from the aftermath of the Great Recession is finishing just in time for 2020. “The recovery in construction starts that began during 2010 in the aftermath of the Great Recession is coming to an end,” according to Richard Branch, Chief Economist for Dodge Data & Analytics, in the report. He adds: “Easing economic growth driven by mounting trade tensions and lack of skilled labor will lead to a broad based, but orderly pullback in construction starts in 2020. After increasing 3% in 2018 construction starts dipped an estimated 1% in 2019 and will fall 4% in 2020.”
However, not all is expected to go poorly for the construction industry in 2020. “Economic growth is slowing but is not anticipated to contract next year,” as noted in the publication. The fact that it won’t contract signifies that there will still be a great deal of work for employees within the industry, which also means that hiring should not be too negatively impacted. As the report continues, “Construction starts, therefore, will decline but the level of activity will remain close to recent highs. By major construction sector, the dollar value of starts for residential buildings will be down 6%, while starts for both nonresidential buildings and non-building construction will drop 3%.”
Interestingly, the Bureau of Labor Statistics paints a much more optimistic picture of how the construction industry will develop over the course of the next 10 years. “Overall employment of construction laborers and helpers is projected to grow 11 percent from 2018 to 2028, much faster than the average for all occupations,” according to the BLS data.
More specifically, a number of segments within the industry will grow and there will be hiring across various roles. “Construction laborers work in all fields of construction, and demand for laborers should mirror the level of overall construction activity. Repairing and replacing the nation’s infrastructure, such as roads, bridges, and water lines, may result in steady demand for laborers,” according to the BLS. These workers in the United States will, in turn, be responsible for building overall demand for helpers which is expected to be driven by the construction of homes, schools, office buildings, factorie, and power plants.
In conclusion, although it appears that the construction industry will see a growth slowdown in 2020, the Bureau of Labor Statistics suggests that the field will actually grow significantly over the next decade.