July 1, 2013
By Neal Tepel
New York, NY – Fueled by rapid increases in residential and office development, overall New York City construction spending is expected to increase by 6.2 percent this year and by 24 percent from 2012 to 2014, according to a New York Building Congress midyear update of its annual analysis of current and projected construction activity.
After reaching $30.1 billion in total construction spending in 2012, the Building Congress forecasts spending of $32 billion in 2013, and $37.3 billion in 2014. The updated outlook is a significant improvement from the organization’s October 2012 projections, which called for annual spending of $30.2 billion in 2013 and $29.1 billion in 2014.
“The upward revisions in our forecast, from data compiled over the past few months, particularly for the private sector, are extremely encouraging,” said New York Building Congress President Richard T. Anderson. “While the effects of inflation and the rebuilding associated with Superstorm Sandy partly explain the projected increase in overall spending, there is no doubt that much of the gain is fueled by increased private-sector development activity and an improving economy.”
When adjusted for inflation, the value of construction in 2013 is forecast to be about 13 percent below the peak of 2007. But by 2014, the Building Congress expects that spending, expressed in constant dollars, will be just 2 percent below the 2007 peak achieved at the height of New York’s most recent building boom.
The Building Congress projects similar increases in construction employment in the coming years. After producing 114,900 construction jobs in 2012, the Building Congress projects construction employment to reach 119,800 jobs in 2013, followed by 130,600 in 2014. If realized, it will mark the first time that construction employment has topped 130,000 since reaching a peak of 132,600 jobs in 2008.
"The recession and its aftermath have been difficult for members of our affiliated unions," said Gary LaBarbera, president of the 100,000 member Building and Construction Trades Council of Greater New York. "Aggressive measures taken by organized labor, including project labor agreements, were instrumental in allowing billions of dollars of work that was in question to advance and mitigate what could have been a far worse situation.."