FMI predicts U.S. total construction will just about reach 2003 levels next year
FMI Corp.'s latest construction forecast calls for 2 percent growth in 2011 overall, and 6 percent growth in 2012. In today's economy that sounds like ambitious growth, but in constant 2006 dollars, it represents only 3 percent growth for 2012 and a 1 percent drop in construction for 2011. In 2012, U.S. total construction will just about return to 2003 levels in current dollars, according to an FMI release.
Breaking nonresidential buildings down by type, FMI predicts the following:
- Lodging construction will drop 16 percent in 2011 to $10 billion and show some signs of growth at 4 percent for 2012.
- Office construction is highly dependent on employment, and it will take several years until there is enough employment growth to spur new construction. This segment will drop another 5 percent in 2011, compared to a 32 percent drop in 2010, with some improvement expected in 2012 to get to the $45.5 billion mark.
- Health care construction will grow only 2 percent in 2011 and is forecast to grow 3 percent in 2012. This is a drop from the previous forecast.
- Education construction put in place was down 13 percent in 2010, so a reduction of only 2 percent for 2011 and a forecast of 4 percent growth for 2012 is welcome. Other than 2010, school construction has been holding up well during the recession, but the current cuts in state and federal budgets threaten another downturn.
- Religious construction lost another 4 percent in 2011 and will continue to be weak in 2012.
- After holding up well with projects under way, public safety construction lost 8 percent in 2010, another 4 percent in 2011 and will drop 3 percent again in 2012 to around $12 billion.