Construction markets are no longer “a net drag” on the overall economy, said Andrew Duguay, senior economist for ITR Economics. Duguay took a closer look at what’s happened in the U.S. and Canadian economies over the past year and made predictions for 2013 and beyond in the recent MDM Webcast, 2013 Economic Outlook.
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“We managed to recover in 2009 without much activity in the residential and non-residential markets. Finally, we’re getting that portion of the economy back on track, so it’s going to contribute to the United States economy rather than hinder it,” Duguay said.
Nonresidential private construction has seen 15 percent growth over the past quarter year-over-year. Although nowhere near pre-recessionary levels, Duguay said “we’re on the right path.” Distributors selling into this area in 2013 can expect greater opportunity than in the past year.
Federal spending, though, is down 14.9 percent and Duguay says there is “no upside in sight” because of the looming fiscal cliff and accompanying budget cuts.
Market improvement in construction is even more visible on the residential side, which posted 35 percent year-over-year growth over the past three months. “This is a great time to be in residential,” Duguay says. “Housing starts are finally starting to rise off of the recessionary floor.”
Wholesale trade increases in the hardware, HVAC, lumber and other construction materials categories are also indicative of an upswing. For more, access the 2013 Economic Outlook webcast on-demand or order a copy on DVD.