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'Future of Construction' report forecasts construction growth to outpace the manufacturing and services sectors this decade

2021-10-12T11:43:00-04:00

Construction will be an engine of global economic growth in the decade to 2030, with output expected to be 35% higher than in the ten years to 2020, according to a new global forecast.

The report, titled Future of Construction, by Oxford Economics and Marsh McLennan subsidiaries March and Guy Carpenter projects that growth in construction output will average 3.6% per year from now until 2030, outpacing that of the manufacturing and services sectors. According to the study, this is driven by swift recovery from the Covid-19 pandemic and stimulus support from governments. The spending of accumulated excess household savings and demand for residential space is also credited as a factor behind this growth.

Growth will be concentrated in China, India, the United States, and Indonesia, which will account for 58.3% of estimated global expansion. Infrastructure is expected to be the fastest growth sector for construction over the decade, driven by government stimulus plans fueling global infrastructure projects, such as the $1.2 trillion bipartisan infrastructure bill in the U.S.

AIA Consensus Construction Forecast predicts accelerated growth through 2019

2018-01-29T14:28:00-05:00

Construction spending for nonresidential buildings is projected to increase 4 percent this year and continue at that pace of growth through 2019. While the commercial construction sectors will generate much of the expected gains this year, by 2019 the industrial and institutional sectors will dominate the projected construction growth. [...] However, in the face of a supportive economy, construction spending on nonresidential buildings disappointed last year.

The American Institute of Architects has published its latest Consensus Construction Forecast, and it's looking quite rosy. Despite labor shortages and rising material costs that continue to have an impact on the construction industry, the report — supported by the last few editions of the Institute's monthly Architecture Billings Index — projects a 4% increase for nonresidential buildings this year and a continuation of this pace through 2019.

Analyzing this economic optimism, the AIA points out five key factors:

Rebuilding and repairs from natural disasters
Tax reform implications for construction
Possibility of an infrastructure package
Strong consumer and business confidence levels
Leading economic indicators for the construction sector

For the full report and an interactive version of the infographic above, head over to aia.org.

Can these positive projections be felt in your firm or region as well? Let us know in the comment section below.

AIA's Consensus Construction Forecast downgrades expectations for 2017 and 2018

2017-07-24T15:51:00-04:00

Entering 2017, construction forecasters were quite optimistic about the near-term outlook for the industry. [...] However, as of the mid-year 2017 update, the grounds of this euphoria are evaporating. [...] key elements of the Trump administration’s legislative agenda have made almost no progress. [...] As a result, the AIA Consensus Construction Forecast panel is predicting slower growth for the construction industry for the remainder of 2017 and through 2018.

"The slower estimated growth for 2017 is expected to continue through 2018. Overall spending growth is currently projected by the Consensus Forecast panel at 3.6 percent for next year, down modestly from the 4.9 percent forecast entering this year. Commercial construction is expected to perform closest to prior expectations, with the 4.0 percent expected growth in spending for 2018 down less than 0.5 percentage points from the late-2016 forecast. Industrial construction is now likely to see very modest 1.1 percent growth next year, down from the prior expectations of 3.3 percent, while the institutional outlook has dropped from the 5.8 percent forecast of six months ago to 4.1 percent with the current projections."

For the full report and an interactive version of the infographic above, head over to aia.org.

AIA's Consensus Construction Forecast projects continued but moderate growth in 2017

2016-07-26T12:44:00-04:00

After a strong 2015, there is a growing sense that the construction industry expansion will be more tempered over the next eighteen months. [...] The American Institute of Architects’ (AIA) semi-annual Consensus Construction Forecast, a survey of the nation’s leading construction forecasters, is projecting that spending will increase just less than six percent for 2016, with next year’s projection being an additional 5.6% gain.

“Healthy job growth, strong consumer confidence and low interest rates are several positive factors in the economy, which will allow some of the pent-up demand from the last downturn to go forward,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “But at the same time, the slowing in the overall economy could extend to the construction industry a bit – with the biggest drop off expected in the industrial facility sector over the next year and a half.”

For the full report and an interactive version of the infographic above, head over to aia.org.