Nonresidential construction drops in Q3
The Nonresidential Construction Index (NRCI) dropped from 58.6 to 52.4, which is the first slide in more than a year.
FMI announced the release of its Nonresidental Construction Index (NRCI) for the third quarter of 2011. The NRCI slipped from 58.6 to 52.4 for the third quarter. The report, however, was compiled before the recent stock market slide in August 2011, which has already sparked fears of another recession. It is the first time the index has gone down since the third quarter of 2010 when the reading dropped from 54.5 to 51.3.
In the report’s summary, almost all indicators, including the overall economy, cost of labor, and the nonresidential building construction market were down. No change, however, was indicated in productivity in the third quarter report, which was one of the few positive indicators.
Panelists for the report believe a slow recovery is still possible in spite of cutbacks for government spending for infrastructure. However, continued growth will be difficult if the housing market does not improve because housing growth is what drives construction for schools and other commercial buildings. If the market does not improve, the downturn will likely continue.