A Construction Forecast for Q1 of 2022
The positive trajectory of the construction industry in Arizona and Texas is continuing. We’ve been fortunate in that the sectors in which we build have continued to grow. There were some sectors, including office and retail, that were impacted heavily by the pandemic, but indicators show that 2022 will rebound for those sectors as well.
Training and mentorship is filling the skilled labor gap at LGE Design Build, increasing employee retention. Additionally, compensation is on the rise, making the construction trade a more attractive employment option. Total employment is expected to grow by 1 percent annually, with the fastest job gains occurring in the construction sector.
Consumer demand will remain high. However, the manufacturing sector grew in November 2021 for the 18th consecutive month, slightly improving the supply chain. Supplier deliveries will be decreasing at a slower rate, but backlogs will continue to grow. The lack of raw materials will continue to affect every construction sector.
BUILDING MATERIAL COSTS
Overall construction volume is expected to begin growing in the spring of 2022. Supply chain issues and material scarcity will continue to drive prices upwards. Final construction costs are expected escalate in the range of 4 to 7 percent into 2022.