Construction growth is forecast in 2017 to increase by 6.3 percent nationwide over 2016, according to a respected source in the industry.
“ConstructConnect’s forecast for total construction put in place for 2017 is $1,234.5 billion…,” said the company in a press release earlier this month. “The improved growth is expected to carry over into 2018 where construction spending will improve another 7.2%. Total residential construction spending is expected to grow 7.4% in 2017 to $501.7 billion and total nonresidential is forecast to increase 5.5% this year to $732.8 billion.”
ConstructConnect is a company formed by four construction industry support organizations, to “provide construction industry professionals with the most complete, accurate, and actionable preconstruction data empowering them to make the connections that drive higher profits and fuel greater success for their business.”
In addition to improved growth the company sees three other major trends emerging in the coming year: technology advances, modular construction increases and a worsening labor shortage.
“The industries expected to see the largest growth in construction spending this year are Office at 12.9%, Healthcare at 12.6% and Lodging at 12.4%,” predicts the company. “It’s not good news for all industries as construction spending for Industrial/Manufacturing is expected to decrease 7.2% in 2017.”
Technologically-assisted visualization may become the high point of the technology advances, suggests ConstructConnect.
“The hottest technology trend for construction this year will be the use of augmented reality (AR) and virtual reality (VR),” said the company. “Better project visualization, enabling and improving real-time collaboration among stakeholders and leading to increased adoption of Building Information Modeling (BIM) applications are just a few ways the construction industry will benefit from AR and VR technology. VR will be used more on the design side by architects and engineers while AR will have a larger presence on the construction site. VR will see some use by construction firms in areas like safety training and teaching workers how to properly operate heavy equipment in a controlled environment.”
Build it and take it to the job site.
“Permanent modular construction, sometimes referred to as offsite construction or prefabricated construction, is poised to have another great year in 2017,” insists ConstructionConnect. “Modular construction has been around for decades, it has just recently started to attract interest for commercial construction applications. This is partly due to some high profile projects in the last few years. Owners are also coming around to the fact that modular construction can look just as good as onsite construction and be completed in a shorter amount of time and for less money.
The labor shortage in the construction industry grabbed plenty of headlines in 2016 and ConstructionConnect predicts the shortage will only get worse in 2017.
“In 2016, the construction industry added only 102,000 jobs,” the company pointed out. “This is down from the 296,000 jobs added in 2015 and the 362,000 in 2014. While the numbers for November and December are still preliminary, and could be revised up, the industry went from adding an average of 30,000+ new jobs a month to adding only 8,500 a month jobs in just two short years.
“The latest Job Openings and Labor Turnover Survey (JOLTS) report from the Bureau of Labor Statistics (BLS) for October shows there were 205,000 openings in down just slightly from the 221,000 in September. That’s still a lot of unfilled positions for an industry that managed to add just 28,000 jobs in the last quarter of the year.