Money Matters - Industry News And Highlights
- LeeAnn Maton
- June 26, 2009
A new report from McGraw-Hill Construction Research and Analytics predicts that Chicago-area construction starts will fall 39% from 2008 levels, a higher figure than originally forecast.
Commercial construction in particular is poised to fall hard, Crain's Chicago Business reports, with expected starts this year totaling just $1.67 billion, compared 2008's $6 billion -- a dramatic 73% drop.The institutional sector is predicted to decline 44% to $2.86 billion, while residential building is expected to decline 22% this year. Read the full article here .
“The downturn has accelerated in 2009, and the expected [total] plunge of 39% will be the worst on record,” said McGraw-Hill (whose data goes back to 1967) in the article. “For the full year, starts will total $11 billion, just half of the 2006 peak."
If McGraw-Hill's analysis proves true, 2009 will be both the third consecutive year that Chicago-area construction starts have dropped in value, and also the steepest plunge.
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The construction industry lost 59,000 jobs in May alone, but a new report released by a House of Representatives committee says the U.S. economic stimulus plan is bringing about some good news.
Reuters reports that the stimulus plan created or saved more than 21,000 jobs by the end of May, the report says. Illinois has yet to finish any of its stimulus capital works, but has started the most projects of any state at 542.
Meanwhile, AGC's Chief Economist Ken Simonson saw a "glimmer of hope" for the industry in that 18 states added construction jobs from April to May, although employment overall continues to decline.
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AGC encourages members who have seen a positive impact from the stimulus to let them know. Please see their Stimulus Update Web site.