The U.S. construction industry is expected to witness largely positive growth avenues throughout 2017, according to a construction cost report recently published by the cost management and consultancy company Rider Levett Bucknall (RLB). The report observes that the average construction costs in the U.S. increased by 4.8% over the period between April 2016 and April 2017. The greatest cost rise was seen in San Francisco and Los Angeles while costs declined in Honolulu.
The RLB report mentioned that over the period between April 2016 and April 2017, the average costs of project bids were also high as compared to overall cost required for materials and labors, indicating that the contractors in the construction sector were confident enough, leaving plenty of room for overhead and profits in their proposals. During recessions, RLB observed, numbers in the two indices would be very close.
Across the country, the construction industry is projected to exhibit uniform growth, with the supply of labor expected to go in unison with the demand from construction activities, unlike the lag experienced during times of inflation. However, the number of under-skilled employs working in the construction sector of the country is expected to continue to hamper the productivity of the sector. Shortage of skilled labor continues to remain a key challenge for the U.S. construction industry, though the RLB report indicates that certain sectors and trades in the country are more affected by the factor as compared to others.
The outcome of the new infrastructure package that has been worked upon by the Trump administration is expected to have a major impact on the country’s construction sector. The new infrastructure package has diverted more money towards training of workers for the construction sector and has allocated nearly US$15 bn for a number of transformative projects, US$25 bn for the development of rural infrastructure, and US$100 bn for the development of the local infrastructure of the country.