Construction spending
in October, at a seasonally adjusted annual rate of $1.158 trillion, fell
0.8 percent from September and 0.6 percent from October 2006, according to the Census Bureau.
The
Bureau of Labor Statistics (BLS) recently released economic and employment projections for 2006-2016 in five articles
in the November issue of the Monthly Labor Review (www.bls.gov/opub/mlr/mlrhome.htm).
BLS projected that overall output, net of inflation (real gross domestic product), would rise at an average annual rate of 2.8%, vs. 3.1% in 1996-2006, and
nonagricultural wage and salary employment
at 1.0%, down from 1.3%. Construction output
is
projected to climb 1.4% per year, down from 2%, and construction employment is projected to rise by 781,000 jobs, or 1%
per year. Construction is third among all industries, after food services and
drinking places and offices of health practitioners, in the number of jobs to
be added. BLS wrote, “While there was only minimal growth in nonresidential
investment during the previous decade (0.3% annually), it is expected to
grow at a rate of 1.5% annually over the 2006–16 period. Expanding construction
of nursing homes and other medical treatment facilities, as well as new schools
in faster growing regions, is expected to continue through 2016, as changing
demographics play a greater role in nonresidential investment. Continued work
to improve roads and bridges across the country and the replacement and
remodeling of industrial plants, which will require improvements for a large
number of structures, is expected to provide further support for the expansion of
construction output during the projection period. Investment in residential construction is projected to grow at an
annual rate of 1.7% throughout the 2006–16 period. Although this represents a
deceleration from the rapid growth experienced during the previous decade,
long-term growth is expected to continue and will be strongly influenced by
demographic trends, including an aging population. The building of new
retirement communities, as well as remodeling and home improvement for existing
structures, is expected to continue throughout the projection period.”
