Mace North America reports that the growth of the USA's construction sector is waning, despite the country's economy starting the year on a bullish note.


Greg Parker, managing director of Mace North America.

Buoyed by strong private sector investment, the US economy grew at an annual rate of 3.1 percent in the first quarter of 2019. However, trade tensions and a slowdown in the pace of global growth restricted the rate of expansion in Q2 to 2.1 percent.

According to the construction contractor, growth will slow even further in 2020 and 2021 to 1.6 and 1.8 percent, respectively. This suggests a more muted outlook for the US construction industry.

Industry dynamics continue to vary widely between states; while supply chain capacity is expanding in some, competition is intensifying in others. But the crux of many difficulties across the construction industry in North America, according to Mace, is rising costs in terms of both materials and labour. Tariffs on steel and aluminium, for example, created additional inflationary pressure during the past few quarters.

The increasing costs of delivering projects will challenge construction companies and supply chains in North America in the coming months, concluded Greg Parker, managing director of Mace North America.