Construction Economic News

What’s not to like about May’s upbeat Employment Situation Report from the Bureau of Labor Statistics? No doubt, it depends upon one’s point of view, with the Federal Reserve probably not comfortable with the results at all, but more on that in a moment.

An expected, fallout from higher interest rates is a decline in housing starts. In both the United States and Canada, that proposition is being partly realized, but not to a full degree. The story is best told in graphs, and the bullet points below cover the highlights.

The accompanying table records the top 10 project starts in the United States for April 2023.

Clichés are often true and it is the case that a picture can be worth a thousand words.

Much Will Depend on Y/Y Comparison of Megaprojects ConstructConnect announced today that April 2023’s volume of construction starts, excluding residential work, was $47.0 billion, a decrease of -2.1% versus March 2023’s figure of $48.0 billion (originally reported as $47.6 billion).

Similar to what has been occurring in the United States, labor market conditions in Canada have remained robust despite significant hikes in interest rates orchestrated by the nation’s central bank. April’s nationwide total jobs count north of the border rose by +41,000 according to the latest Labour Force Survey conducted by Statistics Canada.

Once again, there was no dramatically negative change in the U.S. labor market statistics contained in the latest monthly Employment Situation report from the Bureau of Labor Statistics. Quite the opposite. In April, the total number of jobs in the economy rose by +253,000 and the seasonally adjusted unemployment rate stayed extremely low, at 3.4%.

What’s that you say? There’s a bull stock market underway! Yes, indeed, and it seems hard to believe, given that we were talking about bear market conditions only a few months ago. A bull is a gain of +20% or more in an index from its 52-week low and a bear is a drop of -20% or more from its 52-week high.

Much of my work-related conversation over the past year-plus has concerned the preponderance of mega-sized construction projects being green-lighted in the United States. A megaproject is defined as a project carrying an estimated value of a billion dollars or more.

The accompanying table records the top 10 project starts in the United States for March 2023.