Construction Economic News
The current year, 2022, is shaping up to be the best ever for megaproject initiations. Megas are projects carrying an estimated construction value of $1 billion dollars or more each. For many of these projects, there’s also a machinery and equipment component in the total capital spending or investment figure that is often roughly equivalent to the construction cost.
Wages in the construction and manufacturing sectors continued to push higher early in the fourth quarter of 2022. The average hourly compensation for all employees in the construction sector ended October 2022 at $35.27, an increase of 13.2% from the end of 2019. Similarly, manufacturing wages have increased from $28.16 at the end of 2019 to $31.23 in October, notching a smaller gain of 10.9%.
The U.S. and Canadian central banks are determined to slow their economies enough through interest rate hikes to put a choke hold on inflation (which, by the way, is showing signs of relenting in both countries). The slowing of the economy part of the plan is worrisome because it might bring on recessions of who knows what duration or magnitude.
Clichés are often true and it is the case that a picture can be worth a thousand words.
Megaproject Authorizations Remain Upbeat ConstructConnect announced today that October 2022’s volume of construction starts, excluding residential work, was $47.5 billion, a decline of -8.2% compared with September’s figure of $51.7 billion (originally reported as $51.1 billion).
ConstructConnect’s Expansion Index is a monthly measure of the nominal dollar value of planned construction projects compared to the same month one year ago. The Index geographically covers the United States, Canada, and their respective states and metropolitan statistical areas. November’s release, which reports on data collected in the prior month, extended several of the industry trends that ConstructConnect has previously identified.
After a string of months with barely positive or backtracking employment change, Canada struck it rich in October, +108,000 jobs. The biggest portion of the +108,000 gain was provided by services jobs, +63,000 according to Statistics Canada, but manufacturing and construction also had good hiring months, +24,000 and +25,000 jobs, respectively.
ConstructConnect’s annual construction starts statistics for bricks and mortar retail sites are set out in Graph 1. The history goes back to 2005, and the forecast portion of the chart extends to 2026.
A month ago, the Employment Situation report from the Bureau of Labor Statistics reported a U.S. total jobs-count increase during September of +263,000. Now, for the month of October, a nearly identical change in total employment has been estimated by the BLS, +261,000 jobs. (By the way, September’s figure has just been revised to +315,000.)