Reasons For Optimism In 2010… For Starters, It's Not 2009
December 1, 2009
A plumbing contractor told me recently the recession has been good for his business. The downturn has forced him to operate more efficiently. He’s paying more attention to his numbers and cutting wasteful spending wherever he finds it.
The downturn has made training easier, he added. Employees realize they need to perform to keep their jobs.
I like lemonade as well as the next guy, but I personally am ready for times to get better again. I’m certain the plumbing contractor would agree.
Economists tell us the recession ended a few months ago. The reason you may have missed it is because so many people still are looking for work. The housing market is showing signs of life, although tight credit continues to hamstring the nonresidential construction market.
I’ve been quoting one particular economist, Sergio Rebelo, who I heard speak at a luncheon in late October. If you’re looking for reasons to believe that the 2010 economy will be better than what we’ve experienced this year, he pointed out that a quick economic recovery has followed every post-World War II recession since 1948-49.
The two previous recessions, in 1991-92 and 2001, ended in “jobless recoveries,” he noted. That means unemployment rates continued to go up even after growth resumed.
While citing reasons why the current recovery may not be as fast as the others, Rebelo did give another reason to be optimistic. Only about 20 percent of $787 billion in federal economic stimulus money has been spent this year.
That means 80 percent has yet to be spent. Almost 50 percent of the total will be distributed in 2010.
The government has allocated $30 billion of that money for green construction. About 80 percent of the funds will be spent over the next two years.
Last month’s Greenbuild show in Phoenix provided more reasons to be optimistic about next year. In a down market, the product expo and conference sponsored by the U.S. Green Building Council continues to be one of the most upbeat construction industry events.
I attended a press conference there that tied green construction to job growth. Among the findings in research done by Booz Allen Hamilton is that green construction supported more than 2.4 million jobs between 2000 and 2008. During the same period, green buildings provided $123 billion in labor earnings and generated $173 billion in gross domestic product.
The study’s positive outlook for 2009-2013 shows green construction generating an additional $554 billion in GDP while providing $396 billion in labor earnings.
“By the year 2013, this study estimates that green buildings will support nearly 8 million jobs across occupations ranging from construction managers and carpenters to truck drivers and cost estimators,” the research states.
About the only downside to these increasing numbers can be found in the relatively small space green buildings occupy in the overall construction market. Excitement about sustainable buildings will contribute, however, to the overall economic recovery.
You’ll find yourself in the best position to take advantage of green buildings and other opportunities if you’re like the contractor I mentioned at the beginning. Those who have improved their operations and trained their people during the recession will benefit most during the recovery.