McGraw-Hill Construction, our publisher, recently announced some of the highlights from its 2010 Construction Outlook, which was released this week. The headline indicates some good news for the coming year: "Construction Market to Increase 11% in 2010."
Of course, how good the 2010 construction market turns out for any contractor or designer depends on the type of projects a firm concentrates on, as well as the region in which it works. According to McGraw-Hill Construction, there will be definite ups and downs in the coming year. Even so, the company's forecasters believe an improvement in housing from extremely low levels and broader expansion for public works will boost overall contract activity to $466.2 billion during the coming year. That follows a 25% decline predicted for 2009.
“The U.S. construction market in 2010 will be helped by growth for several sectors, following three straight years of decline that brought total construction activity down 39% from its mid-decade peak,” said Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction at the 71st annual Outlook 2010 Executive Conference in Washington.
Regarding continuing impacts from the federal stimulus, the press release quoted Murray as adding: “The benefits from the stimulus act will broaden in scope, lifting not just highway construction but also environmental public works and several institutional structure types. With continued improvement expected for single-family housing, after reaching bottom earlier this year, the overall level of construction activity should see moderate expansion in 2010.”
Here are a few of the other main points that McGraw-Hill Construction noted:
- Single family housing will advance 32% in dollars, corresponding to a 30% increase in the number of units.
- Multifamily housing will improve 16% in dollars and 14% in units, after steep reductions in 2008 and 2009.
- Commercial buildings will drop 4% in dollars, following a steep 43% drop in 2009. The weak employment picture will further depress occupancies, making it even more difficult to justify new construction.
- Institutional buildings will begin to stabilize after losing momentum in 2009. Square footage will retreat another 2% after sliding 23% this year. The dollar amount of construction for this sector will edge up 1%, helped by a growing amount of energy-efficiency upgrades to federal buildings and continued strength for military buildings.
- Manufacturing buildings will drop 14% in dollars and 3% in square feet, hampered by the substantial amount of slack manufacturing capacity.
- Public works construction is expected to rise 14%, given more wide-ranging strength across all project types.
- Electric utility construction will slip 3%, continuing to settle back after a record high in 2008.
All of this raises the question - What do YOU think the 2010 construction market will be like in your area? Let us hear your opinion. We might even be able to use your comments in our upcoming reporting.
The 2010 Outlook is available for purchase, here.