ARTBA predicts ‘modest growth’ from U.S. transportation construction infrastructure market
Black also notes that major reconstruction work along the East Coast in states that were affected by Hurricane Sandy could also be a market factor in 2013 across all modes. Additional federal, state and local emergency funds for rebuilding this infrastructure could be a boost as projects get underway.
A major wild card in the forecast, Black says, is the so-called “fiscal cliff”—the dire financial situation set to occur at the beginning of 2013 if Congress and the President can’t agree on tax and spending reforms. Although the “fiscal cliff” would not directly impact federal highway investment to the states, it could affect state and local finances, and thereby cause governments to pull back or delay projects. Such action in turn would have negative consequences on the highway construction market.
Individual businesses may also delay capital and hiring decisions amid the uncertainty.
Bridges & Tunnels
After a four-year run of significant market growth—reaching a record high $28.5 billion in 2012—the bridge and tunnel construction market will cool off in 2013, likely remaining flat at about $28.2 billion. The ARTBA forecast shows projects in eight states—California, Florida, Illinois, New Jersey, New York, Pennsylvania, Texas and Washington—will continue to account for about half of the U.S. market activity in this sector. With a number of major bridge projects on the horizon, however, the bridge and tunnel sector should rebound smartly in 2014.
ARTBA’s 2013 forecast for other transportation modes is as follows:
Ports & Waterways
Driven by expanded sea trade expected with completion of the Panama Canal expansion project in 2015, U.S. ports and waterway construction is expected to skyrocket nearly 25 percent to $2.65 billion. Increased market activity is anticipated in California, Florida, Kentucky, Maryland, Massachusetts, Mississippi, New Jersey, New Hampshire, New York, Texas, Virginia and Washington.
Airport Runways & Terminals
Airport runway and terminal construction is expected to show growth in 28 states, with sector growth overall of 4.5 percent, reaching $12.5 billion. Market-driving states include: Alaska, Arizona, California, Florida, Illinois, New York, Ohio, Tennessee and Texas. Funding for airport projects is anticipated to increase over the next five years, largely tracking growth in passenger enplanements.
Light Rail & Subways
The uncertainty caused by the 33-month long delay in passage of MAP-21 will be felt in the subway and light rail markets. Construction activity is projected to be down by eight percent overall. There will be some bright spots, however. Based on recent contract awards, these states will be moving forward on key transit projects: California, Florida, Georgia, Hawaii, Illinois, Kansas, Massachusetts, New York, Oregon, Pennsylvania, Texas and Washington.
The forecast uses an ARTBA econometric model that takes into account a number of economic variables at the federal, state and local level. It is measuring the public and private value of construction put in place, published by the U.S. Census Bureau. The ARTBA estimate of the private driveway and parking lot construction market is based on data from the U.S. Census Bureau’s “Economic Business Census.”
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