Building momentum … or not
Maine is faring better than many states in its speed with awarding stimulus-funded construction projects, but that was about the best news economist Ken Simonson had to share at the Portland meeting of the Maine Chapter of the Associated General Constructors earlier this month.
“I was in Colorado recently where 69% of stimulus money for highways has been awarded … and in New Mexico, it’s about 80%,” said Simonson, chief economist with AGC of America. “But Maine is up to 100%, I learned, so congratulations on getting your stimulus money out the way it was intended.”
Maine received $131 million in stimulus money for shovel-ready transportation projects around the state, helping to offset the loss in construction jobs, which dwindled by 12% between June 2008 and June 2009, slightly below the national average of 13%.
Stimulus money aside, bringing construction jobs nationally back to their pre-recession levels will be a challenge. Though tax credits and low-interest mortgages have helped encourage a rise in the housing market, the multi-housing, commercial and industrial markets are still lagging, Simonson said. Privately financed developments are expected to stay well below 2008 numbers, though spending on public works-related projects will likely match 2008 levels, thanks to stimulus funding. Power and energy projects will likely stay healthy, helped by the $11 billion in stimulus funding designated for grid projects nationally. Simonson predicted some increased activity in institutional projects, as schools see their endowments and capital campaigns start to turn the other way.
His advice to Maine contractors was to consider out-of-state projects, as Reed & Reed recently did in its bid to build a $10 million Massachusetts wind farm, and consider stimulus projects that have yet to be awarded such as high-speed rail. “But your fate is dependent, in part, on the state’s economy as a whole,” he said. “I can’t say I’m optimistic about the outlook for state and locally funded projects.”
Carol Coultas
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