The US construction industry is forecast to grow by 8.8% to reach around USD 1,355,097 million in 2022. Despite some challenges in construction sectors, medium to long-term growth remains intact.
The construction industry in the US is expectedly to grow steadily over the four quarters. Moreover, the growth momentum will continue in the forecast period, recording a 5.0% CAGR from 2022 to 2026. As a result, the construction output in the country will indeed reach around USD 1,650,159.2 million by 2026. So, have a look at an explained growth rate of the construction Industry.
The growth rate of construction industry explained in the United States remains stable from the short to medium-term perspective.
Several projects in the United States are working through the planning phase. In contrast, some have resumed finally after the global pandemic year caused delays. Therefore, despite several challenges linked with the worldwide supply chain, the residential construction sector will grow stable. It is predicted to be stable over the next four to eight quarters.
Moreover, since Q3 2020, there has been double-digit growth in the residential construction sector. Therefore, it has significantly contributed to the rebound of the construction industry and the overall economy.
The US residential construction sector remains reinforced by low lending rates, low housing inventory, and strong demand for bigger homes. In addition, over the next few quarters, the education and healthcare sectors will receive more attention.
Government spending on infrastructure development will support United States market growth.
The US Congress passed an infrastructure spending bill of approximately USD 1 trillion in November 2021. In new federal expenditure, the infrastructure legislation proposes USD 550 billion. It is for the next eight years to upgrade bridges, roads, and highways. And also to modernize the passenger rail networks and city transit systems.
Demand for industrial space will allure investments.
The online shopping industry in the United States is one of the biggest in the world. However, the big online shopping holiday comes during a warehouse shortage, as the vacancy for distribution centers stands low. According to the Q4 2021 Global Construction Survey, there is a usage of approximately 95% of existing industrial space in the United States.
Large retailers drive the demand for industrial space by expanding their e-commerce operations amid the pandemic-led boom. Moreover, retailers are also securing extra storage space to mitigate the impact of coming supply chain bottlenecks. It pushes industrial developers to be more creative and determine unconventional areas for building warehouses.
With the increase in the demand for industrial spaces, the development of industrial areas will grow over the next four to eight quarters. It will subsequently help in the growth of the overall construction industry from the short to the medium-term point of view.
Large construction activities to support the industry in Louisiana
The construction sector will continue growing in Q1 2022, as various projects are forecast to go under construction. For example, construction activities will probably begin by January 31 on the USD 463 million projects. It will add 8.3 miles of elevated highway in Louisiana. Moreover, spending on these roads and highway infrastructure projects will support market growth over the next four to eight quarters.
Linda Rawson, who is the founder of DynaGrace Enterprises (dynagrace.com), an 8(a) graduate and EDWOSB, contributed to the content of this blog. She is the founder of GovCon-Biz. For further information, please connect with Linda on LinkedIn, or contact her at (800) 676-0058 ext 101.
Please reach out to us at GovCon-Biz should you have any questions.