The Building Tradesman Newspaper

Friday, February 25, 2011


By The Building Tradesman

Construction drops in January

The value of new construction starts retreated 6 percent in January to a seasonally adjusted annual rate of $423.4 billion, according to a Feb. 17 report by McGraw-Hill Construction.

The decline came as the result of a pullback for nonresidential building after a strong December , combined with a loss of momentum for residential building. At the same time, the non-building construction sector showed further growth in January on top of its elevated December pace, aided by several large public works projects.

On an unadjusted basis, total construction starts in January were reported at $28.4 billion, down 4 percent from the same month a year ago.

“The construction start statistics continue to move in an up-and-down pattern, showing that overall activity has stabilized in a broad sense but has not yet gained sufficient traction for renewed expansion to take hold,” stated Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction. “Over the past two years, public works construction has held up fairly well, and healthy activity was reported for this sector in January.”

He said public works construction is likely to slip in the coming months, with the waning support of the federal stimulus money. He said upward movement from housing and commercial sectors would be needed as an indicator that construction was gaining momentum.

Senate stops attack on Davis-Bacon

WASHINGTON (PAI) – By a 55-42 vote, the U.S. Senate defeated the first Right Wing attack in the 112th Congress on the Davis-Bacon Act, which mandates prevailing wages, state by state, on federally funded construction projects.

Lawmakers rejected an amendment to the pending Federal Aviation Administration bill to ban Davis-Bacon from any project the measure funded. Sen. Rand Paul, R-Kent., a Tea Party favorite, pushed the ban, which would have dumped Davis-Bacon standards – and lowered wages – on future airport construction projects worth billions.

Paul argued he was only trying to save money, claiming that prevailing wage requirements added up to 30 percent to construction costs of public projects in his home state of Kentucky. Numerous other studies debunk claims that there are any savings in repealing Davis-Bacon/prevailing wage. He also denied his amendment was anti-union.

Senate Labor Committee Chairman Tom Harkin, D-Iowa led the opposition to Paul’s attempt to cut construction workers’ wages. “We need Davis-Bacon so that our infrastructure projects are built safely for millions of Americans who rely on them, because contractors that pay prevailing wages hire higher skilled and better trained workers, and they produce safer buildings, airports, bridges, roads, and tunnels.”