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  • Writer's pictureerica6918

Dodge Report That Is Positive Economic Output for Commercial Construction

Updated: Jan 5




The year 2022 experienced plenty of uncertainties in terms of inflation, shortages of labor, the Ukraine war, and rising interest rates, but there have been a few bright spots too in the construction industry.

Here is a glimpse of the report released by Dodge Data & Analytics. It talks about the company’s outlook on 2023 construction industry performance and says there is no guarantee of a recession.


Keep reading to know more details about the report.



Dodge Report in Detail

The chief economist of Dodge Data & Analytics, Richard Branch, delivered the company’s “On the Razor’s Edge: Will the U.S. Economy Enter Recession and How Will Construction Starts Respond in 2023” via an online webinar on Nov. 15. This report is based on an analysis of several data categories the company tracks throughout the year and partly based on historical data through the end of September.


Though it is predicted that the U.S. will likely head towards a mild recession in 2023, Richard Branch said during the webinar that a recession might not happen. In his words, even if it happens, it might not be as severe as the Great Recession of 2008 or the downturn in 2001. This is because the banking system is in great shape and the housing market is woefully undersupplied.


There are a few issues that need close attention and can be potential recessionary events:

  • Increase in tension between China and Taiwan

  • Further violent Ukraine and Russia conflict

  • Rail Strikes

  • Oil price hikes


Richard Branch added that there is a very, very narrow path to avoid a technical recession in 2023.



More Insights on Factors Influencing Recession

A section of the Dodge report also discussed how various factors influencing the recession might ease the situation.


  • The report predicted that the Federal Reserve would keep increasing the rates to combat inflation; by March, it might be in the range of 4.25% to 4.75%. Richard Branch said, “ Q1 would go deeper negative, Q2 would flip over into negative, Q3 would come pretty close to the zero line but stay positive, and Q4 would come down, as well.”

  • Labour shortage might ease the recession. There will be essentially no job creation in the first half of the year, so the job cuts and increase in unemployment will be much lesser compared to the earlier recessions.

  • The number of planned constructions is rising steadily, and the Dodge Momentum Index is at a 15-year high.

  • After rates stabilize in Q2, the impact of the residential housing market on commercial construction will begin to improve towards the end of the year. The decline in single-family construction will affect retail market construction as well.

  • It is the best year for multi-family construction since 1986 as they are more economical than single-family homes. Though there might be a decline of 9%, it will still be a robust market.

  • The local bond measures supporting construction related to education, roads and bridges, clean energy, water, and sewer will boost public construction.

  • Post-pandemic revenge travel has boosted hotel construction, and we can expect mild gains for the hotel construction market in 2023.

  • 2023 will bring stability and insurance to the construction industry through manufacturing and institutional construction.


For more insights on the Dodge report, you can contact the construction experts at Reliable Commercial Construction. Contact us today for high-quality construction and exceptional service.

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