According to the new national and state construction hiring and business forecasts released by Associated General Contractors (AGC) of America and Sage Construction and Real Estate, 73% of construction firms plan to expand their payrolls in 2017.

Optimism appears partly based on expectations the new Trump administration will invest in infrastructure and cut regulatory burdens.

According to the 2017 Construction Hiring and Business Outlook, contractors expect private and public sector demand to grow in all market segments.

Many firms still, however, report they remain worried about the availability of qualified workers and rising health and regulatory costs.

“Contractors have relatively high expectations for 2017 as they predict the economy and demands for all types of construction will grow,” said Stephen E. Sandherr, the association's chief executive officer. “As a result of this optimism, many firms expect to expand their headcount next year.”

“Contractors remain quite concerned about labor shortages, tight margins and growing costs,” added Ken Simonson, the association's chief economist. “In particular, as additional older workers reach retirement age, firms will struggle to find qualified workers to replace them.”

Most contractors had a positive outlook for all 13 market segments included in the survey. They were most optimistic about the outlook for both the hospital and retail, warehouse and lodging markets (23 percent net positive for both).

Respondents were also positive about the outlook for private office, manufacturing, highway and public building construction. And they are optimistic about the prospects for higher education construction, K-12 school construction and water and sewer construction. 

Association officials noted that overall economic conditions indicate 2017 should continue to be positive for the construction industry. But they added that it appears the Outlook responses are based as much in high expectations for the incoming administration and the President-elect’s commitment to investing in infrastructure, improving federal health care laws and reducing regulatory burdens.

“While the new administration and its stated policy objectives offer many reasons for optimism, there is a significant risk to the industry if the new Congress and administration under-deliver,” Sandherr said referring to policy proposals the association is making. “If plans to invest in infrastructure, reform healthcare laws and roll back regulations are delayed, many contractors will likely scale back their plans to expand headcounts.”

Click here for the survey results.

Click here for state-by-state survey results. 

To read PHC News' 2017 Forecast article, click here. 

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