Construction Outlook for 2012

The construction industry has been through a tough 2011, ups and down, materials cost increase bankruptcies, double dipping and more. So what 2012 will be like? Another year where the construction forecast is not as good as expected, and while more numbers and studies are available, the general forecast for 2012 calls for steady growth. The McGraw Hill Construction forecast for 2012 predicts that construction starts will be near $412 billion, 4% less than the forecasted level for 2011.

Construction Forecast 2012 Key Findings McGraw-Hill

Based on significant research and in-depth analysis of macro-trends, the 2012 Dodge Construction Outlook details the forecasts for each construction sector, as follows.

• Single family housing in 2012 will improve 10% in dollars, corresponding to a 7% increase in the number of units to 435,000. This is still a low amount, as the excess supply of homes due to foreclosures continues to depress the market.
• Multifamily housing will rise 18% in dollars and 17% in units, continuing its moderate, upward trend.
• Commercial building will grow 8%. Warehouses and hotels will see the largest percentage increases, but improvement for offices and stores will be modest.
• The institutional building market will slip an additional 2% in 2012, after falling 15% in 2011. The tough fiscal environment for states and localities will continue to dampen school construction, and the uncertain economic environment will limit growth in healthcare facilities.
• Manufacturing buildings will increase 4%, following the 35% gain in 2011, as the low value of the U.S. dollar continues to support export growth.
• Public works construction will drop a further 5%, after a 16% decline in 2011, due to spending cuts and the absence of a multiyear federal transportation bill for highway and bridge construction.
• Electric utilities will retreat 24%, following a 48% jump in 2011.

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