Page 29 - BusinessWest December 7, 2020
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Annual Industry Outlook Predicts Slow, Uneven Recovery in 2021
In its recently released 2021 Dodge Construction Outlook, Dodge Data & Analytics predicts that total U.S. construction starts will increase 4% in 2021, to $771 billion.
“The COVID-19 pandemic and recession has had a profound impact
on the U.S. economy, leading to a deep dropoff in construction starts in the first half of 2020,” said Richard Branch, chief economist for Dodge Data & Analytics. “While the recovery is underway, the road to full recov- ery will be long and fraught with potential potholes. After losing an esti- mated 14% in 2020 to $738 billion, total construction starts will regain just 4% in 2021.”
Furthermore, he added, “uncertainty surrounding the next wave of COVID-19 infections in the fall and winter and delayed fiscal stimulus
will lead to a slow and jagged recovery in 2021. Business and consumer confidence will improve over the year as further stimulus comes in early 2021 and a vaccine is approved and becomes more widely distributed, but construction markets have been deeply scarred and will take considerable time to fully recover.”
He noted that the dollar value of starts for residential buildings is expected to increase 5% in 2021, non-residential buildings will gain 3%, and non-building construction will improve 7%. “Only the residential sec- tor, however, will exceed its 2019 level of starts thanks to historically low
mortgage rates that boost single-family housing.”
The pattern of construction starts for more specific segments is as
• The dollar value of single-family housing starts will be up 7% in 2021,
and the number of units will grow 6% to 928,000. Historically low mort- gage rates and a pref-
 erence for less-dense living during the pan-
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