During a national online news conference June 19, ABC Chief Economist Anirban Basu stated the nation’s construction industry may not recover next year.
“I’m not buying in to the proposition that the nation’s construction industry will recover in 2013,” said Basu. “What we have right now is an utter lack of confidence in the economy, and confidence represents a centrally important requirement for construction spending growth.
According to Basu, while there is capital and profitability in the broader economy and money sitting in the banks, many decision-makers have adopted a wait-and-see attitude until the sea of uncertainty related to the future path of federal spending, tax rates, the financial chaos in Europe and our own 2012 elections recedes.
“No sector of the economy during the recession has lost more jobs than the construction industry, with nearly five million jobs lost since December 2007,” said Basu. “And what we now see is that job growth is decelerating. The trend is not positive for construction employment in the months ahead.
“However, it’s not all bad news,” Basu said. “Certain construction segments likely will experience growth in the coming months, including healthcare and power generation.”
Basu was joined by National Association of Home Builders’ Chief Economist David Crowe and American Institute of Architects’ Chief Economist Kermit Baker.
To watch a recorded version of the 2012 Mid-Year Construction Forecast Online News Conference, go to the newsroom at www.abc.org.