Source: Associated Builders and Contractors
According to a report released by Associated Builders and Contractors, the private construction industry’s value added as a percentage of the nation’s real gross domestic product rose to 4 percent in 2016, the highest level since 2009. The report also shows annual growth in real construction spending, which rose 3.5 percent in 2016. Thirty-seven states benefited from the rise in construction activity in their state, while 13 states experienced a reduction in activity.
“Although the relative impact of the value added by private construction on various state economies varies both among states in a particular year and within a state over time, every state benefits from construction activity,” said Bernard M. Markstein, Ph.D., president and chief economist of Markstein Advisors, who conducted the analysis and prepared the report for ABC. “The increase in that activity in a particular year adds to the income and potential growth of each state. A decline in that activity acts as a drag on a state’s economic performance.”
The 3.5 percent national increase in real construction spending was a slowdown from the 4.9 percent increase in 2015. Only 18 states had a greater growth in real construction spending in 2016 compared to 2015.
2016 CONSTRUCTION SPENDING: TOP FIVE STATES
The fastest growth was in the West and the South. The first state outside of those two regions in the ranking of construction growth rates is Rhode Island with the 16th largest increase (up 4.9 percent). In 2016, the top five states for the increase in their real value added from construction in order from highest to lowest were:
- Idaho, up 10.7 percent
- Georgia and South Carolina (tie), up 9.4 percent
- Florida, up 9.3 percent
- Oregon, up 9.1 percent
2016 CONSTRUCTION SPENDING: THE BOTTOM FIVE STATES
All of the bottom five states suffered from the effects of low energy prices.
- Mississippi, down 2.5 percent
- West Virginia, down 7.5 percent
- North Dakota, down 10.5 percent
- Wyoming, down 11.5 percent
- Alaska, down 13.2 percent
Read more at Associated Builders and Contractors.