Published By : 09 Dec 2015 | Published By : QYRESEARCH
The industrial and commercial construction sectors in the United States are forecast to witness continued steady recovery next year, according to the US national trade association Associated Builders and Contractors.
Even though the global economy has been rather weak, the US industry’s steady economic recovery during this year is likely to continue next year owing to strong consumer spending, said Anirban Basu, chief economist at the Associated Builders and Contractors.
Basu said that with the mid-phase of the economic recovery in the United States continuing, the growth in the nonresidential construction spending is forecast to be 7.4 per cent in 2016, in addition to growth in backlog and employment, according to the Associated Builders and Contractors. He added that the middle phase of the recovery is generally the longest part and this eventually makes way for the late phase at a time the economy is overheating. There is a possibility that the present recovery period might challenge the longest recovery period in the history of the country, which went on for 120 months from March 1991 to March 2001.
The ABC chief economist said that signs of overheating in the US economy were already showing, indicating to shortages in skills in major industry segments such as construction and trucking.
He added that there were also signs of certain technology and real estate categories becoming overheated owing to unusually low capitalization rates and rocketing purchase prices. Basu said that the leading indices of the Associated Builders and Contractors indicate that next year will be yet another steady year for the typical nonresidential construction company in the United States.
The latest Construction Confidence Index survey shows that the overall confidence of contractors has risen in terms of both profit margins as well as sales, from 61 to 62.9 and from 67.3 to 69.4 respectively.