The authors forecast residential construction to drop 3% as housing takes a breather from its sizzling pace of recent years, but that “commercial, office and industrial construction will rebound.”
The auto industry is expected to lead the rebound in the manufacturing sector. “The decline in numerous manufacturing industries, whether occurring through technological change or offshore movement, has prompted a dramatic decline in the construction of manufacturing facilities for five consecutive years,” says Forecast 2004.
With respect to the commercial construction market, Forecast 2004 applied the following reasoning:
“Overall, the lack of job growth within many of the nation's industries has contributed to a considerable drop in commercial construction activity over the past couple of years, with the pipeline essentially cut in half. While over 200,000 office-based jobs have been added, businesses have begun to re-occupy offices left vacant during the recession. The commercial real estate market needs to work off excess supply amid weak demand conditions. With corporate profits forecast to improve 10.7% in 2004, a rebound is likely.”