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Mid-year economic outlook for nonresidential construction: Expansion continues, but vulnerabilities pile up

Emerging weakness in business investment has been hinting at softening outlays.

AUGUST 12, 2019 |

Courtesy Pixabay

More than 10 years after the end of the most severe financial crisis since the Great Depression, the U.S. economy is again making history by continuing its longest-ever expansion. Nevertheless, emerging weakness in business investment has been hinting at softening outlays, giving commercial and industrial construction contractors cause for concern, according to a mid-year economic outlook by Anirban Basu, chief economist of Associated Builders and Contractors.

“Given that every expansion in U.S. history has ended in recession, leaders of construction firms are rightly wondering when the record-setting expansion will end,” said Basu. “Looking at conditions on the ground, it likely won’t be in 2019, but 2020 could be problematic for the broader economy and 2021 for a significant number of contractors.”

Basu cites numerous vulnerabilities that could trigger a recession in 2020, including:

— Trade wars

— Softening corporate earnings

— Slowing job growth

— Elevated levels of household, corporate and government debt

— Election 2020

But there are plenty of reasons to remain optimistic. “For the most part, the economy has held up better than anticipated,” said Basu. “During the first quarter of 2019, gross domestic product expanded at a smart 3.1% annualized rate. The U.S. Bureau of Economic Analysis’ initial estimate suggests that the economy slowed to 2.1% growth during the second quarter, but that neatly beat economists’ expectation that that growth had fallen below 2%.”

“The economy could continue to prove resilient,” says Basu. “To date, the economy has navigated ongoing trade disputes and associated tariffs with aplomb. It has also withstood serial interest rate hikes, the longest federal government shutdown in history, extreme weather, shifting immigration policy, ongoing labor market shortages and a lengthy investigation regarding foreign influence in U.S. elections.”

To read the full economic outlook story, visit ConstructionExec.com.

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ASID Resource Center

ASID 2019 Outlook and State of Interior Design Report

 

The American Society of Interior Designers’ (ASID) 2019 Outlook and State of Interior Design (OSID) report provides an extensive scan and summary of the essential knowledge needed to stay on top of constant change, to create a competitive edge, and to flourish in the interior design profession. The report first identifies key issues in the U.S. economy and construction industry to track during 2019 and includes projections based on 2018 conditions. A review of trends and disruptors at the macro-level, and in interior design specifically, comes next, including data that illustrates the state of interior design as a whole and the design implications that follow. The report ends with insights from interior design thought leaders on what they observe in practice and what to expect moving forward.

KEY HIGHLIGHTS

Economic Outlook

The U.S. economy saw improved growth in 2018 and the general outlook is for moderate economic growth in 2019 and 2020, but at a slower rate. Trade is a substantial risk to the economy with the imposition of tariffs increasing the prices of building materials. The stimulus from the 2017 tax cuts helped push the national unemployment rate, but increased federal debt and could result in higher interest rates. Despite the uncertainties and disruptions in economic activity, the overall outlook for 2019 is positive.

Trends, Disruptors, and the State of Interior Design

Macro-level trends and disruptors mimic the trends and disruptors we see in interior design, and these influence how interior designers run their businesses, create solutions to projects, and further advance the profession. A few highlights are:

  • Top issues interior design business leaders are tracking include economic conditions, competition from other firms, and price increases on goods, services, and construction materials.
  • Slight shifts in the services interior designers provide indicate a change in future business – including new markets hiring interior designers, new positions added in design teams, and an increase in contracted services.
  • Changes in the U.S. population’s demographics will reshape the built environment and require solutions that address diversity and inclusion.
  • Technology continues to evolve and be embedded in our lives and the spaces we inhabit. Designers need to keep up with the changes and anticipate how new technologies may alter the design paradigm in the future.

Future Insights from Thought Leaders

The impact of interior design on the human experience is receiving increasing attention. As clients become more educated and aware of the research and science that empowers design solutions, increased requirements for data and performative outcomes are pushing interior designers to explore new innovations and expand their scope of practice. Interior design needs to evolve along with the changes happening around us in order to stay relevant.

 

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Continue reading ASID Resource Center

ASID 2018 Outlook and State of the Industry Report

The American Society of Interior Designers’ (ASID) 2018 Outlook and State of the Industry (OSI) report provides a scan of the essential knowledge interior designers and the interior design industry require to thrive and remain competitive in 2018 and beyond. The 80-page ASID OSI explores the status of the U.S. economy as a whole and offers an in-depth look at the interior design and construction industries specifically; discusses current trends in design and their implications for the profession moving forward; and concludes with a look at the societal and technological advancements that will influence the interior design industry into the future.

Continue reading ASID 2018 Outlook and State of the Industry Report

ASID 2018 Outlook and State of the Industry Report

The American Society of Interior Designers’ (ASID) 2018 Outlook and State of the Industry (OSI) report provides a scan of the essential knowledge interior designers and the interior design industry require to thrive and remain competitive in 2018 and beyond. The 80-page ASID OSI explores the status of the U.S. economy as a whole and offers an in-depth look at the interior design and construction industries specifically; discusses current trends in design and their implications for the profession moving forward; and concludes with a look at the societal and technological advancements that will influence the interior design industry into the future.

KEY HIGHLIGHTS

Economic Outlook

The U.S. economy is now at or near full employment with an expectation of moderate economic growth in 2018 and 2019. With economic activity in recovery mode, growth in spending is stabilizing at a level similar to actual costs.

State of the Interior Design Industry

The interior design industry demonstrates continuing growth in its economic contribution, the number of jobs, and the number of firms since 2012, but at a slower pace, in contrast to prior expectations.

Trends and Design Implications

Trends seen in the economy, business, society, technology, and the interior design industry, all have an impact on the design practice and the projects designers create. Key trends include:

  • Demographics shifts
  • Technological syncretism
  • Emerging technologies
  • Increasing competition from non-designers

The report offers a translation of the design implications of each trend and a discussion of the need for designers to reposition themselves and their services in the marketplace, and to recalibrate their value proposition. 

Future of the Profession

The interior design profession is at the vortex of change that is rapidly evolving the world. Advancements in technology have transformed innovations into accessible and affordable opportunities, making change inevitable. Designers must understand the impact of change on our personal and professional lives and exercise agility, always ready for the future. Designers play a critical role in solving complex problems by focusing on issues such as technology, circadian lighting, and material health.

 

Non-member price:
$249.95
Member price:
$0.00

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