10/16/2012

Is the Design and Construction Industry in Trouble?

 

Are we experiencing a slow recovery? Is it time to panic? The design and construction industry, still devastated from the real estate crash, could face another $2 billion in lost work if Congress and the White House fail to reach agreement on a federal budget in time to avoid massive mandatory federal spending cuts on January 2, an American Institute of Architects (AIA) analysis released today warns.

Using data issued last month by the Office of Management and Budget (OMB), the AIA analysis identifies 48 separate budget accounts targeted for spending cuts that directly fund the design, construction and rehabilitation of buildings and other vertical infrastructure, including the iconic Capitol dome that is the symbol of American democracy throughout the world.

“At a time when both political parties are campaigning on being the best at creating jobs, both are risking the jobs of millions of Americans by placing ideology above governing," says AIA President Jeff Potter, FAIA.

“The design and construction industry is a significant portion of the national economy, and we urge both sides to put aside their political differences and come up with a budget that keeps people working, especially if they are working on a national infrastructure befitting of the 21st century,” says Potter.

The Budget Control Act of 2011 requires some $1.2 trillion in spending cuts absent an agreement by Congress and the White House to reduce the federal deficit by other means. As of August 2012, numerous agencies across all three branches of government accounted for a seasonally adjusted annual rate of federal construction put in place of $25.2 billion, according to the U.S. Census Bureau.

In July, a study by the George Mason University Center for Regional Analysis found that the total employment impact of budget cuts on federal personnel in architecture and engineering occupations at 61,483. However, this number does not include the job losses incurred by government contractors or construction workers, which could possibly boost that number significantly higher.

The AIA analysis uses a 2007 Center for Regional Analysis study to further pin point job losses in the sector. According to that study, every $1 billion spent on design and construction yields 28,500 full-time jobs. Under that formula, as many as 66,500 full-time positions could be lost in a sector that accounts for roughly 11 percent of the nation’s economy.

For more information, read the full report here.

 


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Visit our website today to learn about the design flexibility of a Morton building and the endless possibilities of partnering with our designBUILD team.


Wood construction is both cost and energy efficient. Check out Morton Buildings and our designBUILD team online today to discover all the benefits of post-frame construction.


When choosing a metal-clad building for your next construction project, consider Morton Buildings, Inc., and their designBUILD team, we’ll make your dream a reality.

We Can Help You Reduce Energy by 30%

Our mission is to help our customers manage their buildings' energy costs, improve reliability, and enhance performance while having a positive impact on the environment.
CLICK HERE to find out how.

Add highly responsive multi-zone comfort to any building project, in any climate. Our CITY MULTI H2i R2- and Y-Series VRF systems give you flexibility to fit the needs of any building. Enjoy 100% heating capacity at 0°F outdoor ambient, and 85% heating capacity at -13°F outdoor ambient.  For more information, log on to www.mitsubishipro.com

 
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