Several indicators, including the labor market, stock market
and consumer conﬁdence levels, tell a story of a U.S. economy
that is riding high.
Cristian deRitis, senior director at Moody’s Analytics, told at-
tendees of the 2018 Dodge Construction Outlook Conference
that the general outlook of the economy is positive.
There are a record number of job openings (more than 6.1
million), and the unemployment rate remains in the low 4-per-
cent range, with only 6.8 million people unemployed.
deRitis noted that there are nearly enough jobs available
for all of those unemployed, but that a “skills mismatch” re-
mains a hurdle. Additionally, factors such as the opioid crisis
are disqualifying workers from jobs in many ﬁelds, including
construction and trucking.
That aside, the “quit rate” in the U.S. is rising to record lev-
els, which deRitis said is a good sign for the labor market. “It’s
a risk to quit your job for something else,” he said, adding that
a high quit rate demonstrates conﬁdence in the labor force
that there are better opportunities out there.
I’m very optimistic in the labor market today, and this is a
trend that should continue throughout 2018,” he said.
deRitis said both individuals and businesses are conﬁdent
about the future, and home equity has been rising, further
increasing consumer conﬁdence.
He said the commercial real estate market looks promis-
ing, though the biggest threat is the potential for increased
interest rates. “If interest rates do rise, this could make some
projects look unproﬁtable that look proﬁtable today.”
He added that there is a need for general infrastructure
spending, but concerns on the local, state and federal levels
may stand in the way. Other uncertainties include tax reform,
which could provide a boost to businesses and spur investment.
“So when is the next recession?” deRitis asked, answering
his own question with a prediction of 2020, based on how he
projects the unemployment rate to trend. He said historically
recessions have come in ten-year intervals and toward the be-
ginning of the decade.
The institutional side spiked 14 percent this year and
is projected to grow 3 percent next year. Growth has
been helped by educational building, which continues
to increase in 2017 and will again do so in 2018.
K-12 school construction is larger and more volatile
than colleges and universities,” said Murray. He said in
015-2016, much of the upturn came from K-12 proj-
ects, though colleges have strengthened in 2017.
Healthcare facility construction has also been ticking
up over the last few years and will increase again in 2018.
The ongoing debate over healthcare reform has cre-
ated near-term uncertainty, though a push to move
along previously deferred projects has supported growth
in 2017. Additionally, the storefront clinic subsector is
growing and could be a plus for renovation work.
“Though it will probably be a garden variety recession—prob-
ably more of a six-to-nine-month recession,” he said. “It will be
nowhere near the depth of the GDP contraction or the unemploy-
ment rate we saw [in the Great Recession].”
The sector is still supported by a need to replace aging
facilities,growth of the elderly population and a move to-
ward the‘hub-and-spoke’ system,”added Murray.
Another key subset within institutional has been
transportation terminals, where construction surged
N i c k S t . D e n i s is the research editor
of USGlass magazine. He can be reached
at firstname.lastname@example.org. Follow him on
Twitter at @NickStDenis.
20 percent in 2017. While that sector will pull back
slightly in 2018, it will maintain its elevated rate.
December 2017 | USGlass, Metal & Glazing