Economic Update

Commercial flat; highway work down 

The ongoing decline in residential building continued to drag down the construction economy as expected, while commercial construction may have started to pull back from its record levels of 2007. That’s the consensus of the most recent set of economic reports analyzing the construction sector’s performance during the first two months of 2008. The U.S. Department of Commerce reports that nonresidential construction rose 11 percent over the same period in 2007, but increased only 0.1 percent between January and February.  

Associated Builders and Contractors believes that the commercial market has peaked and commercial building could begin to decline in the months ahead. In the public works sector, highway construction appears to be weakening as well, according to a survey by Associated General Contractors of America. In the AGC survey of highway contractors, 77 percent of respondents reported a reduction in DOT contracts, mainly due to state budget problems in providing matching federal funds for highway work.

Click here for the Associated Builders and Contractors Construction Economic Update (pdf)