Some economist have dubbed the current economic troubles “The Great Recession” to differentiate it from the Great Depression of the 1930s. While there are significant differences between the two economic calamities, there is one striking similarity: a sharp and prolonged decline in construction costs. Source: Turner Construction. Year-to-year percent changes for selling price of construction. Turner’s cost index Source: BLS. Forecast by IHS Global Insight Blip in Lumber Prices Source: IHS Global Insight Housing starts firm Related Links: Industry Has Little Confidence About Near-Term Market Gains Medical Costs Trump Savings From Safety Recession Steadies Prices For Liquid Paving Product Airport
The House has taken another stab at steering federal funds to school construction. The chamber on Sept. 17 approved a measure that would authorize more than $6.5 billion for public-school and community-college projects. The provision is part of a bill that would expand the federal college-loan program and curtail private lending in that sector. The focus now moves to the Senate, where the fate of the construction proposal is uncertain. The measure would authorize $2.02 billion annually for fiscal 2010 and 2011 to modernize, renovate or repair K-12 public schools. Another $2.5 billion would be available for new construction or
Rising medical costs are driving up workers’ compensation costs despite the success of safety programs in reducing the frequency and severity of construction accidents. “There are a number of competing factors affecting rates,” says Mary Ann Krautheim, client strategy officer for Aon Risk Services’ Construction Services Group, Boston. Incident rates are dropping because of increased safety measures, as well as a drop in the labor force due to the recession. Lost-time payments are declining, but the cost of claims is rising. “Medical inflation is countering the positive trends,” Krautheim says. “So it’s a push-pull relationship.” Related Links: Competition Intensifies as
The construction industry continues to be stuck in a major recession, and, for most firms, the end is not in sight. But the latest ENR Construction Industry Confidence survey shows some industry leaders sense that mid-2010 may show the beginning of some relief from the drought. + Image How Different Groups View the Market Related Links: Competition Intensifies as Recession Deepens Medical Costs Trump Savings From Safety Recession Steadies Prices For Liquid Paving Product Airport To Squeeze Fuel Costs With Hydraulic Hybrid Pickup Lower Materials and Bid Costs Help States Push Projects Construction Squeeze Takes Toll As Wage Hikes Flatten
The Associated Builders and Contractors released its latest Construction Backlog Indicator on Sept. 22, which shows an 8.9% increase in backlogs in July for its members who were surveyed. On average, the CBI shows backlogs increasing from 5.6 months to 6.1 months. “While the July increase was significant, June was the lowest point for the CBI since ABC started the indicator in November 2008,” says the association's chief economist, Anirban Basu. He says the downturn may be over for the nonresidential market.
The $787-billion American Recovery and Reinvestment Act has about $130 billion slated for construction. While much of the money is slow in coming, the first wave of funded projects typically were repaving and other quick, off-the-shelf highway projects. These had contractors scrambling and bidding ferociously, keeping prices at bare-bone levels and opening the door for even more construction projects. Photo: Michael Moore Source: Florida DOT Three quarter moving bid-price index Related Links: Competition Intensifies as Recession Deepens Industry Has Little Confidence About Near-Term Market Gains Medical Costs Trump Savings From Safety Recession Steadies Prices For Liquid Paving Product Airport To
Revisiting efforts to funnel federal funds into school construction, the House has approved a measure that would authorize more than $6.5 billion for K-12 public school and community-college projects. The provision is part of a bill, which the House passed on Sept. 17, that would expand the federal loan program for college students and curtail private lending. The measure would authorize $2.02 billion annually for fiscal 2010 and 2011 for modernization, renovation or repair of K-12 public schools. Another $2.5 billion would be available for new construction or modernization of community colleges, starting in fiscal 2011. Groups like the American
A White House meeting between Canadian Prime Minister Stephen Harper and President Obama did not produce an agreement to resolve Canada's concerns over the American Recovery and Reinvestment Act's Buy American provisions. Photo: Office of Prime Minister Harper Obama and Canada's Harper say issue is minor in overall bilateral trade picture. Related Links: Canadian Leader to Discuss 'Buy American' Issue with Obama Obama did say the two sides are trying to find ways to ease the problem but he and Harper portrayed the issue as minor compared with what Obama termed the "robust" overall U.S.-Canadian trade picture. Canada has said
When Canadian Prime Minister Stephen Harper meets with President Obama at the White House on Sept. 16, Canada's search for relief from the American Recovery and Reinvestment Act's Buy American provision will be one of his top priorities. Related Links: 'Buy America' Worries Persist Despite Waivers ARRA 'Buy American' Mandate Draws Flak Canada has objected to the provision for months, saying that its manufacturers are being hurt by ARRA's restrictions on use of non-U.S-made steel and manufactured products in projects funded by the legislation. The Canadians' prime focus is on ARRA-funded projects that are administered by states and localities, in
The industrial and manufacturing sector, already care-worn with decades of ‘hollowing out’ as plants moved overseas, continued its slow spiral downward in the last year. The economic crisis that hit in fall 2008 further sapped capital expenditures across the board, and the bankruptcy of two of America’s Big Three automakers this spring contributed to the decline. Photo: DPR Construction Solar-cell manufacturing facilities, like this 45,000-sq-ft design-build plant for Suniva, are a rare bright spot in manufacturing. Photo: Kia Kia is finishing its first auto-assembly plant in the U.S. There are some bright spots, however. New starts have ramped up for
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