Construction Economic News
Coming out of the pandemic, the U.S. economy is primed to ‘roar,’ with GDP growth expected to be near +7% year over year in 2021, although moderating afterward. Consumers have confidence and cash, having padded their wallets and purses after experiencing reduced outlets for spending during the several waves of lockdowns over the past year-plus.
The ten graphs in this article update the latest housing starts information for the U.S. and Canada through May 2021. Both countries are currently experiencing new home building booms. Super low mortgage and secondary-financing interest rates, a build-up of savings while being locked down during the pandemic and the pronounced shift to working from home and escaping from crowded downtown cores have been some of the major contributors to the uptick in new accommodation demand.
ConstructConnect’s Expansion Index ties to the inventory of all the projects the company has in its database that are in the planning stage, ahead of ‘starts’ or when the ground is broken.
The most accessible single-source resource on construction material price movements is the Producer Price Index data set from the Bureau of Labor Statistics. The PPI series monitors prices charged by producers as they exit through factory gates.
According to a monthly survey carried out for the Conference Board and The Business Council, CEO confidence is currently the highest it has ever been or at least dating back to when attempts to measure it began in 1976. But expectations of exceptional growth prospects are being tempered by limitations arising from: (a) shutdowns necessitated by critical parts shortages; (b) rapidly climbing commodity and other input price increases; (c) difficulty in recruiting qualified workers to fill manpower requirements; and (d) bottlenecks in transportation delivery systems.
Nonresidential Construction Pales Beside Residential ConstructConnect announced today that May 2021’s volume of construction starts, excluding residential work, was $32.5 billion (green shaded box, Table 8 below), a decline of -2.0% versus April 2021’s $33.2 billion (originally reported as $31.5 billion).
Clichés are often true and it is the case that a picture can be worth a thousand words.
Canada’s Labor Market Hopes on Hold In May, for the second month in a row, total employment in Canada retreated instead of stepping forward, putting a hold on hopes for an improving labor market. The latest month-to-month decline in total jobs was -68,000, coming on the heels of April’s setback of -207,000 jobs.
North America’s major stock market indices generally ended May in fine fashion, but there were some changes in month-to-month performances that perhaps hold important significance for future construction activity.