Earlier this year ConstructConnect began publishing a new data product named the Project Stress Index. The strength of the PSI resides in its ability to monitor the weekly level of projects that have had their bid date delayed, have been put on hold, or have been abandoned. The independent rise and fall in the level of projects experiencing each type of event, along with their interdependent behavior, may better allow market watchers to distinguish normal market volatility from actual turns in the market.

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.

As the banking industry reels from some of the largest bank failures in history, many banks—and in particular regional banks—have quickly tightened their lending standards for fear of making loans that may one day sour. This means that many quality construction firms with good credit histories are being denied loans that they would have received just a year ago.

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.

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

Continuing Support from Megas and Semi-Megas ConstructConnect announced today that March 2023’s volume of construction starts, excluding residential work, was $47.6 billion, an increase of +45.0% versus February 2023’s figure of $32.8 billion (originally reported as $33.0 billion).

Supply chain data collected by Federal Reserve banks across the United States have all reported quickening supplier delivery times since at least the end of 2022. In some geographies, supply chain performance has been steadily improving since mid-2022, and the pace at which improvement is occurring continues to accelerate rapidly. The greatest supply chain improvement appears to be along the East Coast, according to data collected by the Federal Reserves of New York and Philadelphia.

The March 10, 2023, collapse of Silicon Valley Bank, followed days later by the failure of Signature Bank, sent shockwaves through financial markets. The cause of their failures was similar in that both experienced dramatic deposits growth in the years just prior to the latest surge in inflation and rates.

During March just passed, the DJI 30 index moved +1.9%; the S&P 500, +3.5%; and NASDAQ, +6.7%. The TSX stayed more or less flat, -0.6%. Only the Russell 2000, which reflects equity price movements for the 2,000 smallest publicly traded companies, was hesitant about putting a brighter face on things, backtracking -5.0% (Table 1).