Friday, February 24, 2012

Expert: Building jobs on rebound

Construction employment is on the rise in Arizona and across the U.S., according to an economist who spoke Tuesday at a national construction-industry convention in Phoenix.

In 2011, Arizona construction jobs increased by 1.6 percent, the 11th-highest increase among the 50 states and the District of Columbia, according to Anirban Basu, chief economist for Arlington, Va.-based trade group Associated Builders and Contractors Inc.

The top-ranked state in 2011 for construction-job growth was North Dakota, where employment increased by 5.7 percent, due primarily to energy-related projects, Basu said.

Basu was among a group of economists, journalists and industry leaders who spoke at the 2012 BizCon convention, held Tuesday and Wednesday at the Arizona Biltmore hotel in Phoenix.

"The construction industry is now beginning to recover," he said.

Basu pointed to three key indicators of the construction industry's health, all of which have turned positive in recent months.

Construction employment had been on the rise in early 2011 but began to decrease in the summer, an aftershock from what Basu described as a "soft patch" in the nation's economic recovery, caused by high gas and food prices and a bitter fight in Congress over raising the debt ceiling.

The downward trend ended in November, and construction employment has since increased nationwide, he said.

"Construction is adding jobs in the country again," Basu said.

Another key indicator known as the Construction Backlog Index showed considerable recovery in 2011, he said, although it ended the year down slightly from its annual peak.

The index, which Associated Builders and Contractors releases quarterly, is an average of the backlog of work all U.S. construction companies have accrued, measured in months. An increase in the backlog is a sign of improvement.

In the fourth quarter, the reported index was 7.8 months, Basu said, down slightly from 8.1 months in both the second and third quarters but up 10.9 percent compared with the fourth quarter of 2010.

The third key indicator, known as the Architecture Billings Index, measures changes in the average amount of money architectural firms bill clients in a given month.

The American Institute of Architects, a Washington, D.C.-based trade group, reported slight architecture-billings increases in November and December following several months of decline.

Architecture billings are significant because they are a reliable leading indicator of future construction work, Basu said. He described the boost in economic indicators as a positive, early sign of recovery but said the industry still has a long way to go.

"We are on the mend," Basu said.

by J. Craig Anderson - Feb. 22, 2012 05:27 PM The Republic |

Expert: Building jobs on rebound

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