Construction Spending Growth and Higher Productivity


Expert Author Levent Sert

Construction spending in April is up 0.3% from the upwardly revised March total and up 6.8% from April 2011, according to a report by the Census Bureau. Private nonresidential spending jumped 17% compared to last year. Private residential spending was up 2.8% for the month and up 7.5% over a 12-month period. All this is good. But, is it enough?

Having just experienced one of the deepest recessions since early last century, it’s easy to say progress is good. Construction spending is traditionally the engine that powers the remarkable American economy, at times through public spending but more often than not by private enterprise. The census bureau also reports that as many as 600000 hardhat individuals have now left the construction marketplace for one reason or another. Likely because of the difficulty in finding well-paying construction jobs in private and public sectors.

Construction spending has not geared up to hoped-for or even expected levels. For one reason or another – some political, others financial and even bureaucratic – government spending in construction has been slow to kick in. This has been acknowledged at the highest levels of government, as if it was not sadly obvious. The disrepair, deferred maintenance, delays with so-called shovel-ready projects and the like have all conspired to stall the construction business in USA, the traditional engine of growth. With few real alternatives, is it time to take a fresh look at this lagging sector and factors affecting its progress such as single and multi-family housing, mortgage financing, foreclosures, public works projects, roads, bridges and schools and others the 600000 hardhat individuals and many millions of others are yearning for.

To a lot of economists, business moves in cycles and is self-correcting. Maybe! For now, our best bet seems to be an informed and productive collaboration between public and private enterprises and most of all achieving increased productivity, namely better management using better software tools to get the job done in less time and more effectively. This includes the larger corporate-wide software such as financial accounting and ERP, but also includes task-specific software tools such as construction cost estimating, project job costing and construction activity planning tools. Typically, these tools are perfectly suited to desktops and laptops and perhaps one day soon, will find an equally perfect niche with the ubiquitous tablet computer. That’s what I’d call ground up productivity.

For now, let’s all do our part and hope for the best.

Dedicated to workplace productivity, Levent Sert is involved in software development and marketing for the construction industry. With over 30 years of experience in construction and computer software, the author believes the industry has come a long way and yet, in some ways, it’s just the beginning.
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