In each Economic Update, the Research staff analyzes recently released economic indicators and addresses what these indicators mean for REALTORS® and their clients. Today’s update discusses the latest construction spending data.
- More construction occurred in November. Good news in terms of some anticipated increases of new housing in the upcoming months and in terms of job creation prospects for construction workers and general contractors. From one year ago, the value of completed construction rose by 6 percent. A huge 16 percent gain was observed in residential home and apartment construction while commercial construction barely budged.
- Though construction activity has risen by about 15 percent from the low point three years ago, total construction jobs have increased by only 6 percent. That is, given the less than full recovery, more physical work is done by each of the current job holders.
- Digging deeper into the data of different segments, one finds long-term declines in the construction of religious service buildings and amusement-recreation parks. America, perhaps, may be becoming less religious and more angry.
- Taken for granted in rich countries, better construction in durable methods have saved many lives from natural disasters. It was not uncommon to witness a death of 100,000 or more in the aftermath of a hurricane or earthquake a century ago. For example, a few seconds of an earthquake in Tokyo in 1923 took 140,000 lives. Even today, death tolls are many magnitudes higher in poorer countries than in richer countries when a natural disaster strikes because of the differences in building codes. Some new office towers in San Francisco are being built with “sliding” floors so that it can be more earthquake resistant. Therefore, kudos to all the architects who are improving our lives.