During the real estate boom ten years ago, contractors in the construction field as well as almost every other facet of the economy that was linked to construction were seeing huge profits and even backed up work. However, that all changed during the recession and the construction industry plummeted. It became almost impossible to finance new construction jobs and obtain the necessary materials such as angle iron needed to complete projects. These days are behind us, however, and as a new year is upon us, economic predictions for the construction industry, and hence the steel industry are looking very good.
In a report released in November by the Associated Builders and Contractors, chief economist Anirban Basu has predicted a steady growth and continued recovery in U.S. commercial and industrial construction for 2015. Non residential construction spending is predicted to have the largest growth. These include power, lodging, office space and manufacturing. However, sluggish growth is forecasted for the public sector. Those in the industry know, however, that this is in sync with multi year patterns which include private non residential spending exceeding public non residential spending. Since this has become status quo, many in the industry are not overly concerned according to Mr. Basu.
To back up his predictions, Mr. Basu has cited that on December 5, 2014 a report was released by the Bureau of Labor Statistics which claimed that the U.S. construction industry has added 20,000 in November, 4, 900 of which were non residential construction. Although this is great news, there does remain concern that although there is now sufficient demand for construction work there could be a lack of skilled workers who are experienced with working with angle iron and other special building materials.
Construction clients themselves are the best source of data concerning this prediction, as there has been an ongoing dissatisfaction and shortage of skilled construction workers. This is likely a result of the fact that when the industry slowed down and construction work plummeted, many individuals began seeking employment in other industries. Young individuals who would have been entering the construction industry during that period made tracks for other employment opportunities as it appeared there was no opportunities in construction. So for some time the in flow of new, skilled workers slowed down considerably. Another aspect affecting the construction industry is that such a crucial emphasis is being placed on American children attending college, that few young people are choosing construction as a long term career choice. Many projects today are experiencing a shortage of skilled workers, and as the current workforce ages and retires the problem will become worse. It is hoped that the increase of vocational high schools across America will begin to encourage young people who do not wish to attend college to seek employment in the construction industry as well as the steel industry to learn how to work with angle iron and other steel materials.
Despite this issue, the outlook for 2015 remains positive for the construction and steel industry. Steel suppliers like Texas Iron and Metal which supply Houston steel for the growing construction industry in Houston will continue to feed this most important of industries.