AGC Chief Economist Ken Simonson released his quarterly Construction Spending, Labor and Materials Outlook. Here's a few takeaways:

1. Three trends are helping many sectors and regions:

  • ‘Shale gale’—mainly downstream after oil price plunge
  • Panama Canal expansion
  • Residential revival, especially multifamily
2. Three trends are holding down construction growth:

  • Government spends less on schools, infrastructure
  • Consumers switch from stores to online buying
  • Employers shrink office space per employee
3. The outlook for housing is modestly optimistic:

  •  Single-Family: rising for now but tight credit, fear of lock-in, demographic shifts may limit increases
  • Multifamily: Upturn should last through 2015
    • Vacancy rates near multi-year lows in most cities
    • Preference for urban living adds to demand
    • Condos have been slower to revive than rentals
    • Government-subsidized market remains weak
  • Improvements: reported 2014-15 decline is not credible; should track SF sales

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