Homebuilding growth noted...
Construction job growth...
And a Colorado mountain highway rebuild...
That and more on Construction News Tracker, brought to you by Caterpillar and produced by ForConstructionPros.com.
Homebuilder confidence in the market has reached its highest level in a year rising to the 59 point level on the NAHB/Wells Fargo Index in May. That's the highest mark since September of 2014 and bodes well for a strengthening economy. The housing market index contains three key components — current sales, expectation for the next six months and buyer traffic — and each is tracking well.
The latest report from the Department of Housing and Urban Development estimated May U.S. housing starts fell 11.1 percent to an annual rate of just over one million units. Continued builder confidence is supported by an 11.8 percent increase in housing permits issued to a rate of 1.28 million units — the highest level since August of 2007. Multi-family housing rose a staggering 24.9 percent for the period to a rate of 592,000 — the highest level in 25 years.
Though 17,000 construction jobs were added to payrolls last month and unemployment continues to drop, questions still abound over the loss of qualified workers that fled the industry during the recession and apparently not returning to the field. What happens next for contractors? We reached out to noted industry economist Ken Simonson of AGC for his take.
The issue is highlighted at Notre Dame University. The famed school has spend on average $95 million per year on construction since 2009, and with its new Crossroads project will spend $237 million per year over the next three years. Yet, contractors are having to recruit workers from Chicago, Detroit and Indianapolis just to keep pace with schedules.
Further hits to the job market may come soon to the energy production field. A report by consultants Ernst and Young claims $200 billion worth of planned deepwater oil and gas exploration has been cancelled in the last few months as a result of the drop in oil prices worldwide. Twenty-four main projects that had been planned over the last 10 years are on hold as an oil glut resulted from new highly successful drilling technology.
An unusual scenario at a massive project underway in California. DPR/Skanska and Apple Corporation will part ways after failing to reach a deal on future work. No one from either side will talk publicly; although Apple has brought Rudolph & Sleeted aboard to complete the buildout of the massive ring shaped building we profiled on a recent Tracker report. The cancellation leaves Skanska $800 million short of project bookings.
Remember the floods of 2013 that wreaked havoc on Colorado? The state DOT plans to rebuild a 23-mile section of U.S. Highway 34 that connects the towns of Estes Park, Lyons and Loveland, much of it meandering through Big Thompson Canyon. CDOT has signed a contract with Kiewit Construction worth some $100 million. Construction is set to begin next month, and completion is slated for 2017.
In closing, life is a beautiful melody; only the lyrics are messed up.
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