November construction starts fell 14% amid labor shortages, rising materials prices

December 21, 2021

Dodge Data & Analytics, New York, has reported construction starts fell 14% in November as contractors continue to struggle with high materials prices, supply chain issues and labor shortages.

“Large projects aside, the underlying trend continues to point to a modest recovery in construction starts,” said Richard Branch, chief economist for Dodge Construction Network. “However, even as projects continue to move forward, the short-term outlook remains cloudy due to continued escalation in material prices and labor shortages. While construction should see some reprieve in 2022, these challenges will restrain the industry’s ability to fully capitalize on both the large number of projects in planning and funding resulting from the infrastructure package. The result will be moderate growth in construction starts over the near-term.”

Nonresidential building construction fell 21% in November. Commercial construction starts decreased 10%, institutional starts rose 28% and manufacturing starts plunged 96%. This decline in nonresidential building construction largely can be attributed to the start of two large manufacturing projects in October.

Residential building construction rose 3% in November. Single-family housing fell 2%, and multifamily construction climbed 16%.

Nonbuilding construction dropped 30% in November, largely because an $8.5 billion project began in the utility/gas plant sector in October.

During the first 11 months of 2021, nonresidential building was up 11% compared with the first 11 months of 2020. Residential building rose 20%, and nonbuilding construction rose 1%.

Tags: Business | Residential | Commercial | Trends


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