January 26, 2015
2015 Construction Outlook
After several years of growth in demand, contractors appear confident about the immediate future, with an overwhelming majority of firms planning to expand in 2015, according to a survey, Ready to Hire Again: The 2015 Construction Hiring and Business Outlook, published by the Associated General Contractors of America (AGC). If predictions ring true, industry employment could expand in 2015 by the most in the decade. Meanwhile, most contractors predict demand will either grow or remain stable in virtually every market segment.
Although the outlook is relatively optimistic, contractors still face a number of challenges. At the forefront of those challenges is the growing shortage of qualified workers to fill available positions.
Despite, or maybe because of these challenges, many firms continue to innovate – embracing new technology.
Private Sector Demand Expected to Drive Growth
Growing demand for private-sector construction is expected to drive much of the growth of the construction sector in 2015. Contractors are particularly optimistic about growth in the retail/warehouse/lodging segment and are similarly optimistic about growing demand for manufacturing, private office, and energy construction.
A number of public-sector construction segments, especially those segments that aren't largely dependent on federal funding, are reportedly primed for growth; while within the public sector, contractors are most optimistic about the outlook for water and sewer construction.
Many Firms Plan to Invest in New Equipment
The vast majority of responding firms plan to purchase and/or lease new construction equipment. Specifically, 79 percent of firms plan to purchase construction equipment this year, up from 74 percent of respondents in 2014. Meanwhile, 81 percent of firms plan to lease new equipment in 2015, compared with 86 percent who reported such plans in 2014.
There is little doubt that the construction industry will continue to recover in 2015. After several years of cautious expansion, many firms are deciding it is time to begin hiring again. Beyond adding to the hours of current staff, firms appear to have the confidence to bring on new workers.
As firms expand their payrolls, they will invest in new equipment, pursue new market opportunities and embrace new and more efficient ways of doing business. Yet, according to the AGC, the industry must still cope with the challenge of growing worker shortages, worrisome regulatory proposals and declining federal investments in construction and infrastructure.
For more information on the survey, visit http://www.agc.org.