Building Boom Slows: Is It A Blip Or Something More Troubling?
Is the recent sputtering in construction just a blip or a sign of something more serious?
Until recently construction was among the few strongholds left in the US economy, but payrolls fell in March and spending in May couldn’t even rise 3% from a year earlier, marking the lowest increase since 2011, Bloomberg reports. That weak growth is even more alarming considering last year the industry experienced lightning growth at 10%.
It looks as if the construction sector may be falling victim to its own success—last year’s extreme pace of apartment building has saturated markets around the country while foreign investors have oversupplied some markets with luxury condos and hotels.
Yet some construction firms are saying they are having trouble finding enough qualified employees to hire, and are being forced to turn down work. Comfort Systems USA says its backlog of projects totals $777M, the highest level since 2008. [Bloomberg]