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Reed Forecast: More Spending For 2014 and 2015

Predicts construction spending will grow 9.3% in 2014 and 11.2% in 2015.


The Reed forecast assumes the economy strengthens modestly, growing at a somewhat faster pace this year and next. As a result, investment in plant and equipment will increase to the benefit of nonresidential building construction.

Heavy engineering (non-building) construction activity is forecast to increase this year and next. Expect increased federal funding for infrastructure projects to be forthcoming this year and beyond, although the amount will be well short of what is needed to repair and upgrade the country's aging infrastructure. Public-private partnerships at the state and local level will provide additional funds for needed infrastructure projects, but still leave us well short of where we should be.

Residential construction will continue to show the greatest improvement, though starting from a low level. Multifamily construction activity has largely returned to normal, although there is still room for some growth. Single-family construction is held back from faster growth by difficulty in obtaining mortgages, scarcity of lots for building, rising building materials prices, skilled labor shortages, and consumer fear.

Total construction spending is forecast to increase 9.3% in 2014 and 11.2% in 2015, with nonresidential and heavy engineering construction strengthening and residential construction continuing to lead the way.

The full article provides current data and a review on the overall economy. It's worth a quick read. Click here to read the full report.

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