Article source: ConstructConnect

Presently, there are a lot of negative factors in play. One might easily cite the disturbing psychological and other impacts of the fighting in Ukraine; the ongoing supply shortages that are only slowly being resolved; an affordability crisis, especially for first time buyers, in residential real estate; general price inflation that shows little sign of letting up; and central bank moves to raise interest rates.
These are probably the chief concerns giving rise to speculation, voiced by some analysts, that the U.S. and Canadian economies may be headed into recession.
Providing counterbalance to such a notion, however, are hearty upbeat messages coming from some of the latest data releases and private sector pronouncements with respect to spending plans.
Consumer spending comprises more than half of gross domestic product (GDP) in both the U.S. and Canada. The share south of the border is 70%; to the north, 56%. (In Canada, foreign trade is a bigger part of the overall economy.)
Retail trade accounts for much of consumer spending. February 2022’s total shopkeeper revenue in the U.S. was +15.9% year over year. Canada’s latest year-over-year increase, but for January, was +12.0%.
There’s no question that some of those y/y sales gains, expressed in ‘current’ dollars (i.e., $s not adjusted for inflation) were due to sizable price increases. For example, sales by gasoline stations have soared mostly because the price of petrol has taken off (i.e., up by one-third or more y/y in both the U.S. and in Canada).
But place the +15.9% y/y retail sales gain in the U.S. next to a +7.9% increase in the Consumer Price Index (CPI) and that means there was still a significant part of the climb that was ‘real’.
Similarly, in Canada, the +12.0% y/y jump in retail trade outstripped the +5.1% y/y increase in the CPI during the same month.
By the way, according to Statistics Canada, the retail sales gain in Quebec in January was +25.0% y/y, with Montreal at +29.0%. (Toronto was +15.1% y/y and Vancouver, +11.0%).

Read the rest of Strong Retail Sales and Construction Commitments say No to Recession

Article source: ConstructConnect
This article is an exploration of where jobs are sprouting in the U.S. economy versus where they are withering. The analysis is carried forward by means of cluster charts comprised of two graphs each and a text box.
The side-by-side placing of the two graphs in each cluster chart has been done with care. The two sub-sectors have been chosen deliberately to explore a specific relationship:

• complementary (e.g., real estate and architectural/engineering design);
• moving in opposite directions (e.g., semiconductor manufacturing and software publishing)
• a lead-in from one to the other (e.g., warehousing/storage and truck transportation),
• they’re positioned within the same pocket of the economy (e.g., coal mining and oil/gas exploration).

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Article source: ConstructConnect

U.S. Permits Still Setting the Pace for Starts

The average of seasonally adjusted and annualized (SAAR) housing starts in the U.S. through the first two months of 2022 has been 1.713 million units, +11.5% versus January-to-February of 2021.

Canada’s comparable 2022 performance has been 238,200 units, -18.2% on a year-to-date basis versus 2021’s same time frame.

The U.S. in February of this current year managed its highest monthly number (SAAR), at 1.769 million units, since before the 2008-2009 recession. Canada, in its monthly readings so far in 2022, has yet to come close to the 300,000-unit level it busted beyond on three occasions in 2021.

Graph 4 suggests ongoing good news for U.S. housing starts. Residential building ‘permits’, which often lead starts, are near 1.9 million units.

Graph 5, however, which also deals with permits, is not as bullish. Graph 5 shows the 12-month moving total of the difference between permits and starts, using ‘actual’ rather than SAAR numbers.

Read the rest of In Housing Starts, U.S. Begins 2022 Faster than Canada

Article source: ConstructConnect
Statistics Canada’s new Labour Force Survey report expels the bad memories from the previous month. The -200,000 net jobs figure for January was pushed aside by the +337,000 number for February.
The services-producing sector, at +293,000 jobs, accounted for the bulk of the big employment increase, but construction made a strong showing as well, +37,000 jobs. In the first two months of this year, Canadian construction has added +60,000 positions.

Manufacturers held even with staffing (+1,000 jobs) in the latest month and they are now employing -9,000 workers compared with the end of last year.

Canada’s seasonally adjusted (SA) unemployment rate is 5.5%, which sits noticeably above the U.S. ‘headline’ rate of 3.8%. But when the not seasonally adjusted (NSA) calculation for Canada is altered to adopt the same methodological approach as utilized by the Bureau of Labor Statistics, the NSA U rate north of the border becomes 4.5% compared with 4.1% in America. In other words, they’re basically indistinguishable.

Read the rest of Forget January’s Misstep, February was Great for Canadian Jobs Generation

Article source: ConstructConnect

When talking with developers and design firms these days, the discussion will quickly turn to the extraordinarily rapid upticks in material and other construction input costs and how they are causing some owners to put project go-aheads on pause while they go back to their teams for suggestions on possible alterations that will return estimated costs closer to initial estimates.
For input prices (or costs, depending on one’s perspective), the most readily available and comprehensive data comes from the Producer Price Index (PPI) material published by the Bureau of Labor Statistics (BLS).
Among the PPI series are two composite construction input cost series. For ease of identification, they appear as (A) and (B) in Table 1. (A) is the last line in the whole table and (B) is the top line in the ochre-shaded section.
There is decade’s worth of history for the index denoted by (A). But the number of material components that make up the composite result in (A) is quite limited. (B) is more comprehensive as to content, but it includes some items that aren’t strictly materials, such as transportation charges. Also, it has a shorter history.
Read the rest of Who Gets to Squawk Loudest about Rising Costs, Consumers or Contractors?

Article source: ConstructConnect

February was another great month for jobs creation in the United States. According to the Bureau of Labor Statistics (BLS), as set out in the latest Employment Situation report, the total number of positions nationwide rose by +678,000.

The construction industry made a significant contribution to that two-thirds-of-a-million jobs gain through net hiring of +60,000 jobs. Most of the +60,000 increase was at the sub-trade level, with residential specialty contractors upping their staffing by +24,000 jobs and non-residential specialty contractors taking on an additional +20,000 employees.

The seasonally adjusted (SA) national unemployment rate (often referred to as the ‘headline’ rate) in February tightened to 3.8% from 4.0% in January. The not seasonally adjusted (NSA) unemployment rate decreased to 4.1% in the latest month from 4.4% in the previous month.

Construction’s NSA U rate contracted to 6.7% in February from 7.1% in January. In February 2020, the percentage of construction workers shunted to the sidelines had been 9.6%.

Read the rest of Wage Spikes & Big Hiring Gains in February’s U.S. Jobs Report

Article source: ConstructConnect

When it comes to new residential construction in the U.S., building permit figures in units are generally accepted as a good proxy (or fill-in) for housing starts.

For the 36 most populous cities in the U.S., the state of Texas claimed three of the five leaders for highest level of starts in full year 2021. Dallas-Ft Worth (76,909 units) was number one; Houston (69,053 units) was number two; and Austin (50,772 units) took fifth spot.

Rounding out the top five were the huge metropolis of New York (3^rd at 58,035 units) and the buzz-worthy city of Phoenix (4^th at 51,923 units). The status of Phoenix as an economic ‘hot’ zone has been reaffirmed by Intel’s decision to spend $20 billion expanding its existing presence there to accommodate two new computer chipmaking plants.

Next in line after the Top 5 was Atlanta with 39,296 units of residential groundbreakings.
North of the border, Toronto narrowly beat Atlanta for housing starts last year at 41,898 units. The other two Canadian cities that would have placed high among U.S. cities for residential groundbreakings in 2021 were Montreal (32,343 units) and Vancouver (26,013 units).
As for year-over-year percentage changes in permits or starts among U.S. cities in full year 2021, Philadelphia was the standout, +132.9%. But the more than doubling of Philly’s starts moved the city only into seventh position for level, at 37,449 units.

Read the rest of EVERCAM Construction Cameras Acquires Funding from Bentley iTwin Ventures to Expand Construction Camera Digital Twin Capabilities

Article source: ConstructConnect

As a month, February is habitually a few days short, but that doesn’t make it less than mighty.

In this most recent February, there’s been a doping controversy in the women’s figure skating event at the Winter Olympics. Vladimir Putin has been having a will-he or won’t-he attack moment along Russia’s border with Ukraine. Anti-vax truckers have been pinching off U.S.-Canadian entry points.

Also, we’re in the 24^th month of a pandemic in North America, compounding the isolation that comes at this time of year anyway, from the stretching out of winter. Inflation has been going through the roof, making Valentine’s Day disgracefully expensive. (Sorry, I just threw in that last bit, which I’ll be sure to regret, when my wife reads it.) And the Queen has COVID; and there still aren’t enough quality new shows to stream on TV.

Against the foregoing backdrop, there are the following nuggets to be gleaned from the latest public and private sector data releases.

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Article source: ConstructConnect

As of January 31, 2022’s closing values, the Toronto Stock Exchange (TSX) registered the strongest year-over-year advance among North America’s four major stock market indices (Table 1). Its lead over the S&P 500 index in second place, however, was miniscule, +21.7% to +21.6%.

Perhaps the bigger story was NASDAQ’s relatively poor showing, +8.9% y/y. NASDAQ has been the traditional frontrunner for years.

The TSX and S&P were also winners on the world stage (Graph 5), although there were some good gains y/y by exchanges in Europe. STOXX Europe was +18.8% y/y; the London FTSE, +16.5%; and the German DAX, +15.2%.

It’s important to note, however, that few of the indices worldwide made headway on a month-to-month basis in January. Only two of the 14 indices set out in Table 2 managed m/m advances, the London FTSE, +1.1% and the Hong Kong Hang Seng, +1.7%. The latter’s uptick should be viewed cautiously, given the Hang Seng’s -15.8% showing year over year.

Read the rest of A New Interest Rate-Inflation Dynamic that Promotes Construction