The Great Recession hit every facet of construction, from housing to commercial builds. Construction workers, architects, landscapers, and building material suppliers were among people hardest hit. But with recent rock-bottom mortgage rates, the federal Making Home
Affordable Program, and an upswing in the housing market, the industry is getting back on its feet. Here are the highlights from the latest Bloomberg article on construction spending and the U.S. Census Bureau of the Department of Commerce.
Construction spending has been increasing since the start of the last quarter of 2011. According to the Commerce Department, “Builders broke ground on more homes than at any time in the previous 19 months and construction permits climbed to a one-year high.” Based on mid-December figures, building permits increased 5.7 percent and housing starts hit an annual rate of 685,000 in November (compared with October).
November 2011 turned out to be a very good month for the construction industry. The U.S. Census Bureau News, released early January 2012, reported that construction spending in November had increased 1.2 percent above October’s figures, putting construction spending at $807.1 billion (compared to $797.4 billion in October).
Additionally, there were significant gains in both private construction and public construction. Residential construction and highway construction had the largest growth from October to November at 2.0 and 1.9 percents, respectively. Educational building rose slightly from $71.5 billion to $71.9 billion, or 0.5 percent; however, there was no increase in spending in nonresidential construction – this sector’s spending stayed the same at $278 billion from October to November.
In the Bloomberg article, CEO John Lundgren of Stanley Black & Decker Inc. said, “To get any better we need some help from commercial construction [but] it’s not going to get any worse from a macro perspective.”
Though the construction industry is on the mend from a four-year economic low, figures from December 2011 will not be available until February 2012. Stay tuned for more construction spending trends on the Knez Building Materials Co. Blog!