WASHINGTON D.C. - Associated Builders and Contractors (ABC) Chief Economist Anirban Basu, American Institute of Architects (AIA) Chief Economist Kermit Baker and National Association of Home Builders (NAHB) Chief Economist David Crowe provided a collaborative economic forecast combining their expert economic analysis on leading, present and lagging economic indicators.
"A combination of low interest rates; wealth effects stemming from a booming stock market and rising home prices; surging energy production; and expanding industrial output has helped position the U.S. economy for more rapid growth during the next several quarters," said Basu said.
"This will lead to more robust recovery in the U.S. nonresidential construction industry, which has also been aided by stable materials prices and improving commercial real estate fundamentals. ABC predicts 7 percent nominal nonresidential construction growth in 2014, despite ongoing challenges in the public construction segment."
Baker, Ph.D, Hon. AIA, also offered a positive outlook but cautioned that government spending must increase to support continued market growth.
"We continue to have an optimistic outlook for the commercial and industrial sectors for the rest of this year and into 2015. However, until we see state and local governments ramp up spending for new education, health care and public safety structures, there likely won't be a widespread acceleration in spending for the entire industry."
Crowe provided a similar take but from the residential sector perspective. "Economic pickup in the second quarter was coupled with a return in housing construction," Crowe said. "We expect continued modest growth in housing construction as employment rises and more household formations take place. However, continued tight supplies of labor and land will put upward pressure on new home prices."