The ink barely had dried on this year’s batch of construction market forecasts when economists had to take a second look at their numbers to evaluate the impact of Donald Trump’s victory in the presidential election, which brought with it a Republican-controlled Senate and House. Most economists are holding firm to their initial forecasts, saying it is too early to sort out all the variables.

Dodge Data & Analytics is forecasting construction starts to increase 5.4% in 2017, after seeing growth fall to 1.3% this year. FMI Corp. predicts that construction put-in-place will grow another 3.9% next year, following this year’s 4.9% increase. The Portland Cement Association’s forecast looks for a 3.5% increase in construction put-in-place, a slight boost over the 3.1% growth PCA estimates for this year. The National Association of Home Builders is calling for single-family housing starts to jump 12.3% in 2017 at the same time the multifamily housing starts cool off. The transportation association, ARTBA, expects to see the strong growth in some states canceled out by weakness in others.

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On the downside, the election does carry some risks, says Ed Sullivan, chief economist with PCA. “No decision-maker likes uncertainty. Trump could have an adverse effect on overall economic activity next year, which, in turn, could affect construction activity,” Sullivan notes.

Upside From Bond Measures

On the upside, voters passed billions of dollars in construction-related bonds, which should brighten next year’s outlook, says Robert Murray, chief economist for Dodge. “Trump offered a wide range of proposals … but the specifics are still to come,” he says.

“Of the various proposals, there are three that are relatively safe to say will have some near-term impact on construction,” Murray says. He thinks Trump’s pledge to “repeal and replace” the Affordable Care Act will have a negative impact on health-care construction. Dodge was predicting that starts for new health-care facilities would increase 7% in 2017. This potential uptick could be balanced by an increase in infrastructure spending as Trump tries to make good on his promise to create jobs. Finally, Trump’s call to “lift Obama-Clinton roadblocks and allow vital energy infrastructure projects to move forward” could help to revitalize a sector that hit a brick wall in 2016, Murray says.

Dodge is forecasting increases between 5% and 8% for most non-building construction markets in 2017. The major exception is a 29% decline projected for the electric utility market, a dip that would follow this year’s estimated 26% drop.

The energy market is coming off a string of large multibillion-dollar, energy-related projects, mostly in the Gulf Coast area, in 2015 and early this year, says Murray. However, the market could not sustain that momentum, and the result was double-digit percentage declines.

If the electric utility and gas terminal projects were excluded from total construction starts, the estimate for 2016 and forecast for 2017 would look very different, says Murray. Excluding this sector, Murray estimates that total construction starts would be up 4% this year instead of 1%. Further, next year’s forecast would be calling for an 8%, instead of 5%, increase in total construction starts.

Market Swell for Offices

The Dodge forecast for the non-residential building markets is fairly optimistic. Murray estimates that office-building starts will increase 18% this year, after a weak 2015. He predicts that growth will continue, with another 9% increase in 2017. “Hotel construction has probably reached its peak with this year’s estimated 25% increase in starts,” Murray says. He forecast the hotel market to grow just another 1% next year.

On the other hand, “further declines in vacancies indicate that neither warehouses nor offices are facing an immediate imbalance of supply versus demand,” Murray says. He forecasts that, overall, the commercial markets will grow about 6% in 2017.

ARTBA is calling for a relatively flat highway-and-bridge market next year. “The passage of the FAST [Fixing America’s Surface Transportation] Act and increases in state and local funding will create real growth is some states, while others remain flat or even decline,” says Alison Black, chief economist for ARTBA. “The FAST Act does provide much-needed funding stability, but it does not provide a ramp up in real funding that would support market growth in each state.”

FMI also sees continued growth in the overall construction market, although at a slower pace than in recent years. Brian Strawberry, senior economist at FMI, notes that many sectors, including residential construction, have seen double-digit growth in recent years, but that pace is not sustainable in the long-term. “We’ve been playing catch-up since the recession,” he says. “Things are settling down now.”

FMI reports that the single-family home market saw double-digit growth in 2012-15, but it estimates growth will pull back to 6% in 2016, with a total value of $246.9 billion. During that time, the multifamily residential market also was hot but now has cooled. FMI forecasts a 7% rate of growth in 2016. Strawberry says he sees similar growth rates in residential in 2017.

In non-residential, FMI also sees a general cooling of activity, particularly on the private side. “A lot of private projects were in planning and are now underway or completed,” he says. One notable exception is the data-center market. Strawberry expects data-center activity, which has been strong in recent years, to continue at a high level. “There are some very large data-center projects underway, with more in planning,” he says. “That will have an impact on the overall commercial market going forward.”

As private work winds down, Strawberry believes more work in the public markets, such as institutional and infrastructure projects, will start to come on line. “If you look at 2017, 2018 and 2019, you’ll see attractive growth rates in education and health care, with health care going a touch faster than education,” he adds.

Strawberry notes that many of the large higher-education projects are sports facilities and related projects. “That ties into economic growth opportunities around those developments,” he says.

PCA’s Ed Sullivan sees solid economic fundamentals in the general economy but a mixed outlook for construction heading into 2017. PCA predicts that GDP will end up at 1.5% this year and 2.4% next year. Unemployment also is likely to remain at or slightly below 5%. In addition, inflation is “not an issue.” The Federal Reserve is “taking its time ramping up interest rates,” he says.

Still, PCA sees the residential market softening in the latter half of 2016. In its summer 2016 forecast update, PCA predicted 6.7% growth in the housing market in 2017 and 2018. However, Sullivan says the market has reached a plateau. “As a result, we haven’t seen some of the growth we expected, even though modest, in starts activity—primarily in single-family homes,” he adds. “That’s a powerful statement because residential is so important in overall construction that it does create a more temperate outlook for this year and next year.” Sullivan adds the caveat, however, that PCA is still its exact forecast numbers.

Meanwhile, non-residential activity remains roughly at the pace that PCA predicted in the spring, Sullivan says. After double-digit growth in non-residential spending in 2014 and 2015, PCA expects growth of less than 5% in 2016. Annual growth could range between 3.0% and 3.5% for the foreseeable future.

Sullivan credits continued job creation as the key driver in non-residential activity. PCA predicts that annual job creation in the U.S. could slow slightly but remain above two million per year through 2020. “If one in five jobs are in an office, that puts pressure on occupancy rates and drives demand,” he adds.

PCA also forecasts increased and sustained government spending, particularly at the state and local levels, as tax revenue generally improves. “It may grow at a modest clip, but it will still grow,” according to Sullivan.