Construction outlook

The Construction Outlook, a quarterly construction market forecast developed by FMI’s Research Services Group, notes that FMI is not yet predicting a national recession or a downturn in nonresidential construction in 2008, although the outlook is tipped slightly downward.

Nonresidential construction was booming in 2007 and will increase again in 2008, although at a slower rate, the report notes. Nonresidential construction will expand at a 5 percent rate in 2008 and a 4 percent rate in 2009 as the declines in residential begin to lower demand for certain nonresidential segments, the report predicts.
 
“There are several drags on the economy such as housing and credit tightening. However, resilient consumers, businesses and exports have so far been able to prop it up,” said Heather Jones, construction economist for FMI’s Research Services.
 
The report also comments on the housing correction. It is not expected to begin recovering until 2009, the report states. However, FMI believes that put in place construction will realize a smaller decline than housing starts due to rising labor and material costs, upgrades and the use of higher-end materials. Despite large declines in total residential and single family construction, both will remain at a high level.
 
For more information about Construction Outlook: Fourth Quarter 2007, or to schedule an interview with Heather Jones, contact Candace Robertson at FMI Corporation at 919-785-9359 or crobertson@fminet.com . Your comment?