The good news? Economists don’t expect a recession in 2020. The bad news? Construction starts will decline slightly.

Dodge Data & Analytics released its 2020 Construction Outlook last week, which called for a slowing economy but no full-blown recession—and construction business owners everywhere breathed a sigh of relief. The outlook referenced the ongoing skilled labor shortage and trade wars as two of the main drivers behind a slight downturn in construction starts.

Here’s a quick breakdown of the forecast by industry segments:

  • Commercial—Starts will decrease 6% in 2020, with warehouses and hotels seeing the biggest drop. Retail and office construction will also decline, but data center construction will help buoy office builds.
  • Residential—Single-family housing starts will fall 3% in 2020. Multifamily housing starts will drop 13% in construction starts, marking an end to 8 years of growth in this segment.
  • Public works—Starts will increase 4% in 2020, mostly due to federal appropriations that have resulted in continued growth in environmental and infrastructure projects.
  • Manufacturing—Dodge cites continuing trade tensions as the main cause for a 2% manufacturing decline in 2020 after a sizeable decline of 29% in 2019.
  • Institutional—Construction starts in this segment are not projected to change much. Dodge predicts small increases in education and medical starts, but they will be offset by decreased dollars in recreational and transportation builds.
  • Electric utilities and gas—After a strong year of growth in 2019 (83%), starts in this sector are forecasted to drop 27%.


Those are the basics. Get advice on how to use this information and further insight from Dodge in our 11/20 issue of theHuddle.