After the uncertainty of the last two years, many in the heavy equipment and construction agencies are looking towards 2022 with hope for stability and profits.
Thanks in part to the federal funding provided by the American Jobs Plan (AJP), a sharp uptick of work on the country’s roads, bridges, and railways is expected to start in 2022. This, combined with the continued need for single family homes that began in 2021, has model simulations expecting a growth of 3.5% for the construction industry as a whole through the end of 2023.
What the numbers show.
Mostly due to influx in funding from the AJP, the private, local, state and federal sectors are all expected to experience double-digit growth through at least 2023. While this is promising for those who work in the infrastructure and residential sectors, the outlook is more mixed for those whose construction focuses on business and commerce. Some businesses, like health care facilities and schools, received federal funding during the pandemic and have grown. Warehouses and transportation facilities have benefitted from private funding as home shipping has increased. And others, like office buildings, have seen a steep decrease in funding as many workers have shifted to remote work.
According to the Association of Equipment Manufacturers, these shifts flatlined growth in the business and commerce sectors in 2021, but experts are cautiously optimistic that a resurgence of those returning to work post Covid will see a 2.9% growth in 2022.
While growth is usually great for an economy, there can be downsides.
This has been seen in the current housing crisis, where the urgent need for affordable housing has led to a shortage of materials and labor and, ultimately, inflation. This is expected to continue through 2022 and beyond, with the US now ranking 4th globally for year-over-year home price increases behind Sweden, Denmark, and Russia.
Inflation is not just limited to the housing market.
Supply chain issues and labor shortages have led to inflation in manufacturing, which then ripples outward toward both construction companies and their clients. However, experts expect that this will level out in 2022. The extra work has also led to an increase in heavy equipment purchases, which has now passed pre-pandemic levels. This is expected to result in a 4% increase in construction machinery sales for 2022, and further growth beyond.
A more positive future is coming soon!
In 2022, Steadfast hopes to see all our partners gain renewed profits and growth.
Whether back in the saddle and ramping up projects or still experiencing tight budgets, Steadfast is here to help you maximize cost and efficiency with the right equipment and staffing. We ourselves are very familiar with the hurdles of the past years, and our goal is to partner with other organizations in success and forward momentum. Contact us today to help you get your project – and your new year! – off to a great start.