US construction spending to outpace GDP over next decade

Spending on construction in the United States is set to outpace the country’s GDP over the next decade to 2020, a report claimed this week.

In an update on the US and Canada, the Global Construction 2020 report - produced by economic consultancies Global Construction Perspectives and Oxford Economics - predicted that spending on the US building sector will grow by an annual average of 6% over the next decade.

The analysis said that despite weaker than expected annual growth of 1.3% in GDP during the second quarter of this year, private sector investment in construction rose by an annual rate of 8% for non-residential and 4% for residential construction during the second quarter. This reversed declines in the previous quarter.

“Construction in the US is expected to rebound from the downturn led by short-term double digit growth in both residential and non-residential markets,” said the report’s author and Global Construction Perspectives director, Graham Robinson.

In Canada, the annual rate of growth in private sector investment in residential construction, at 9%, also outperformed GDP growth during the first quarter while investment in non-residential construction grew by an annual rate of 12%.