Nonresidential construction spending on buildings is projected to grow by just 1.5% through 2020, and less than a one% increase in 2021, according to a new consensus forecast from the American Institute of Architects (AIA).
Construction spending last year was surprisingly weak, but current estimates suggest the industry had a modest increase in 2019. Retail construction activity was expected to underperform in 2019 but did not see the double-digit percentage declines that were expected. The AIA’s consensus construction forecast panel expects similar conditions this year and next.
“The broader economy is expected to continue to see slower growth this year, but the number of potential trouble spots seems to be diminishing,” said AIA chief economist Kermit Baker, Hon. AIA, Ph.D. “Revenue trends at architecture firms saw an uptick in the fourth quarter last year, which suggests construction spending will continue to see growth in the coming quarters.”