Personally, 2021 has gone way too fast. It seemed like just a few months ago the flowers were peeking through the dirt, the grass was growing, and we were looking forward to a summer of travel, seeing friends, and taking part in other activities that were curtailed by the pandemic.
But here we are in the fourth quarter, with less than 90 days left in the year, and in the Northeast, the leaves are falling, and the mornings are crisp. As 2021 reaches a crescendo, it’s perhaps a good time to take stock of where we are … and where we’re going.
The economic recovery has moved somewhat sideways in recent months, with the COVID-19 Delta variant raising concerns that growth may stall. Inflation is mounting, materials are in short supply, and labor is scarce. To add to the melee, disfunction in Washington makes the extension of the debt ceiling, the passage of the infrastructure bill, and even government funding uncertain.
There’s a lot to be concerned with as we get ready to flip the calendar over to a new year. For their part, construction starts are in somewhat of a holding pattern—neither making meaningful advances or declines. Residential construction is shifting, as single family eases and multifamily rebounds. Nonresidential building starts are weak as demand remains in the doldrums. The one exception is the warehouse market, which is on fire. Infrastructure construction is treading water as state and local planners wait for clarity on funding from Washington.
Despite all this, I remain positive that construction markets will pick up speed and gain momentum in 2022. Our leading indicators are telling us that the dollar value of projects in the early stages of planning is at levels not seen in several years. This portends modest growth in starts in 2022.
How confident are we, and where will this growth occur? To find the answer to those questions I invite you to join me at our virtual OUTLOOK 2022 event on November 3, where I’ll discuss the construction starts forecast for the year. Moody’s Analytics Deputy Chief Economist Cris DeRitis will join us and share his thoughts on the economic issues for the new year. I’m also excited about the breakout sessions in the afternoon. We’ll have sessions custom-tailored for BPMs, GCs, architects, and subs that will help you maximize your margins and profitability. You’ll also get the opportunity to hear from some of the construction sector’s top businesses and what they can offer you!
I look forward to seeing you then and helping you find some certainty in an uncertain world.