Talk to any demographer, and he or she is likely to tell you that everything important that is happening in society and business can be explained by demographics or science. As an economist, I don’t fully subscribe to such an assertion. Besides, what would I do if I didn’t have interest rates, inflation, and government policy to mentally juggle as well as the study of demography? But I don’t dismiss the claim either. It does warrant admitting that population level, change, and age-structure over time are key determinants of construction activity in several major type-of-structure categories.
Let’s take a look at how population data can be used to predict construction market trends. This story will be told through the use of seven graphs. The data comes from the Census Bureau (1950 up to 2014 numbers are “actuals”; 2015 through 2060 are projections). The latter adopt standard (i.e., as opposed to outlier) assumptions about fertility rates, births, deaths, and net immigration.
This content is reprinted with permission of Construction Market Data, © CMD 2016.
Opening photo: SSSCCC/iStock/Thinkstock
Now that the recession is in the rearview mirror, consumer confidence is climbing, unemployment rates are dropping, and developers are investing in new construction projects. In turn, nearly all the sectors across the board — with the exception of a few select markets — are preparing for an upturn in 2016. See what construction economists and industry experts predict for the market this year.