The Marcum Commercial Construction Index for Q3, 2019 finds the construction industry in an OK postion as the year ends, despite a mounting drumbeat of negative news.
On the positive side:
- A 1.5% increase in public construction spending in September and a 6.6% increase year-over-year.
- An average backlog of 10.4 months in the infrastructure category, outpacing the commercial and heavy industrial categories.
- A 0.6% decline in construction input prices in September and a 1.7% year-over-year decline.
- New-jobs rate in 17 of the 20 largest Metropolitan Statistical Areas matching or exceeding the new-jobs rate nationally.
- A third cut in interest rates by the Federal Reserve, sparking residential construction and fueling consumer spending.
However, negative news is easy to find:
- 379,000 (4.8%) unfilled construction jobs in August, the highest level in 19 years.
- Construction producer prices up 5+% in the Midwest, West and Northeast.
- 2% year-over-year job growth in October, the slowest gain since 2012.
- Private nonresidential construction, declined 5.7% on an annualized basis
- Debt levels – corporate, governmental, and consumer – have risen massively
The report also notes: The five fastest growing construction segments in the third quarter included: Water Supply (+20.2%), Sewage and Waste Disposal (+18.0%), Public Safety (+8.5%), Highway & Street (6.4%), and Transportation (+5%).
