The rest of 2007 is going to be a “healthy” year for nonresidential construction, according to Ken Simonson, chief economist for The Associated General Contractors of America.
In comments following the release of discouraging February employment statistics that showed the sharpest one-month seasonally adjusted drop in construction employment since 1991, Simonson said he wasn’t much worried: He blamed bitter February weather as the main reason for the chill in the construction sector.
Simonson is heartily optimistic about the rest of the year for nonresidential construction. “There are two reasons to think that nonresidential construction will resume adding jobs soon,” Simonson commented. “First, architects and engineers, whose work gets turned into construction within months, added workers for the 36th straight month. A/E employment has risen nearly 5 percent in the past 12 months. I expect their handiwork to show up in refinery, power plant, manufacturing, hotel and hospital construction spending over the next several months.
“Second, nonresidential construction categories themselves have been growing, aside from the February hiccup,” Simonson added. From February 2006 to February 2007, combined employment in nonresidential building, nonresidential specialty trades and heavy and civil engineering construction increased by 115,000 or 2.7 percent. Meanwhile, Census Bureau data shows that nonresidential construction spending is on a tear, up 15 percent in January compared to January 2006.
The AGC is the largest and oldest national construction trade association in the United States and represents more than 32,000 firms.
ECONOMIST PREDICTS HEALTHY YEAR FOR NONRESIDENTIAL BUILDING
April 26, 2007