The new-year has started – what does it have in store for the construction industry? The 2014 McGraw Hill Construction (MCW) forecast certainly is optimistic, calling for a 9% increase in construction starts this year. The forecast is also predicting a double-digit growth in the dollar value of single family housing, multifamily housing and commercial buildings. MCW is calling for a three-year decline in institutional buildings to end with a minimal gain of 2% in 2014. MCW is predicting that manufacturing work will increase 8% this year, public works will fall another 5% this year and the power market will drop 33%.
The National Association of Home Builders (NAHB) is calling for an increase in total housing starts from approximately 924,000 in 2013 to approximately 1.15 million in 2014. The NAHB considers a normal market to be about 1.3 million housing starts a year.
The double-digit increases in housing are driving overall construction growth. However, there are some positive non-residential forecasts for 2014. MCW predicts that starts for educational buildings will swing from a decline of 2.8% in 2013 to a 3% increase in 2014. MCW is also predicting a 2% increase in health care construction during 2014 after a 2.8% decline in 2013. Finally, MCW is calling for a 2% increase in institutional buildings in 2014 after falling 4.4% in 2013.
The forecast for highway paving and bridge work by the American Road & Transportation Builders Association (ARTBA) is mixed with minimal growth (1.3% increase in 2014 after falling 11.4% in 2013) for paving work but relatively strong growth for bridge construction. ARTBA predicts that the dollar value for bridge work will increase 5.6% in 2014 after increasing 7.1% in 2013 and 5.1% in 2012.
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