I was thrilled to have been invited to construction data firm Dodge Data & Analytics’ Construction Outlook update in New York City recently. Dodge prepared the update to reflect the priorities, outlook and improved business sentiment under the Trump Administration’s America First agenda and Infrastructure and Public Works as part of that focus on rebuilding America’s wealth. It expects to distribute to clients later this week.
Key takeaways by Robert Murray, chief economist of the former Dodge division of McGraw Hill Construction division of S&P:
“During the first half of 2017, we had a sense [that] the current [construction] expansion was getting long in the tooth, and we were wondering how much further could it go. Then the election happened and the mood began to change, with headlines such as this:
Big Post Election Bounce
Executives See Gains from Trump Administration Agenda
“Here we now have,” Murray noted of the business sentiment after the November election, “someone in the White House who knows construction, so wow, with infrastructure, things could be changing for the better.”
Even for the dismal science that economics forecasting can be, Murray and his team see positive signs for the strength of the construction expansion in key public works and infrastructure sectors that will be key to the Administration’s infrastructure agenda, when its turn comes in Congress. He notes:
- Expect to see the construction expansion continuing in ‘17 and throughout ‘19
- Murray (and his economics team) see an increase in growth in ‘17, ‘18 – some flattening out in ‘19, ‘20, ‘21
- Public Works sector growth expected at 6% in 2017, +7 % in ‘18
- Expect to see greater contribution from institutional and public works overall, adding to the current cycle of expansion in the construction industry.
- Just don’t expect a repeat of the boom years (2000s).
For those of you who prefer PowerPoint, here’s a deck of some key takeaways from the presentation: