In the U.S., the forecast for total construction in 2019 stands at $808 billion according to the 2019 Dodge Construction Outlook from Dodge Data and Analytics.
But how will building materials costs, residential construction costs, and other variables impact the construction forecast for the year?
Read on to learn what to expect in the construction industry for 2019 so you can prepare.
Construction Outlook: Managing Cost Pressures
Just as in other industries, construction companies are faced with having to find solutions to do more with less.
There is a lot of pressure on project costs such as residential construction estimates.
In 2019, labor costs are expected to rise as wages continue to go up. Project managers can expect to have their hands full as they try to keep their crews properly staffed amidst pressure to increase wages.
As of November 2018, unemployment sits at a 50-year low at 3.7%. This results in a labor crunch in various industries. And construction is no exception.
The last of the baby boom generation will enter the 55-years-and-older age group in 2020. That means a big group of construction workers will be set to retire in the next decade.
Many companies in the construction industry will need to long look at employee engagement and recruitment in the coming years.
Investing in New Equipment
New tech tools and heavy-duty equipment that is more efficient than ever is available. Yet, companies will have to weigh the high cost of these with the time and cost savings.
For example, a drone could allow a surveyor to review a site in just a few minutes. Augmented reality can create 2D plans into 3D visual models.
Having a better look at what the finished project will look like will allow architects and managers to discover and anticipate design flaws early. Even before the materials are ordered and delivered.
With these types of tools, construction projects can stay on schedule and avoid needless spending.
Construction Beyond 2020 is the theme of this year’s International Construction Week. The latest tech is one of the topics that will be covered.
Building Materials Costs
Building materials costs and steel prices forecast are a concern for those in the construction industry.
In 2018, steel, aluminum, lumber and a wide variety of Chinese imports received imposed tariffs. Often, with little notice.
Some companies were able to use existing supply and so didn’t feel the effect of the higher building material costs in 2018. But, this year, they can expect to.
Suppliers will increase prices based on these tariffs. This will squeeze contractors who have signed fixed-price contracts for this year and haven’t yet bought materials.
Final Thoughts on 2019 Construction Forecast
Thanks for reading. As you can see, there are some uncertainties for the 2019 construction forecast.
Yet, the more you know, the better you can plan, adapt and evolve.
Register today for International Conference Week 2019. It’s the biggest construction event for the ASEAN construction industry. You won’t want to miss it.