In the latest survey conducted by the Associated General Contractors of America (AGC) and Computer Guidance Corporation (CGC), construction activity will improve in 2013 as private sector construction is expected to expand. Firms are also planning on hiring a larger workforce considering the rising demand in the sector.
The results of the survey hinted at the positive turn of events that could take place in the coming year. The construction industry has been going through a gloomy phase for six consequent years. However, the tables are set to turn as more construction firms plan on hiring compared to the ones that plan on cutting jobs.
Private sector construction is set to expand and construction firms are banking upon charging higher rates for their services. However, construction demand for public sector projects is expected to shrink and opportunities are low for the sector.
Construction costs are also expected to rise as raw materials are bound to get expensive. This could lead the builders to lease construction equipment rather than buying them.
In the report, it was observed that construction demand for health care facilities and higher education units are expected to go up. Construction of power units is also estimated to be up. Other private sector segments like warehouses, retail offices and lodges will, however, see little growth.
Among the surveyed contractors, around 40 percent of them claimed that demand for public projects will shrink. Mixed opinions about the public infrastructure facilities' construction have surfaced.
The rigid credit conditions are making it difficult for firms to obtain loans. Around 40 percent of the firms said that the stricter lending rules have either delayed or led to cancellation of projects.
"While the outlook for the construction industry appears to be heading in the right direction for 2013, many firms are still grappling with significant economic headwinds," Stephen E. Sandherr, CEO of AGC said in a statement. "With luck and a lot of work, the hard-hit construction industry should be larger, healthier, more technologically savvy and more profitable by the end of 2013 than it is today."
The survey evaluated around 1300 construction firms from all the states of the country except Delaware. Complete srvey report can be found at AGC's Official Website.
