The construction industry has finally recovered from the financial crisis of 2008, although the recovery didn’t happen in the same sectors that went bust sixteen years ago.
First, take a look at the following graph that shows construction employment from 2000 until now:
As you can see, employment in the construction industry plummeted by about 2.25 million jobs following the ’08 financial crisis and almost made it back until the pandemic hit in 2020. But now, the industry has fully recovered and then some.
What’s most interesting is that much of the job growth is coming from specialty contractors working in the non-residential sector. The building boom is occurring in the technology industry: AI data centers and microchip fabrication plants to be specific.
This has ripple effects for many industries, such as raw materials, construction machinery, and of course, technology. It can be a good starting point if you are looking for investment ideas and is very helpful if you are a real estate investor, especially if you want to diversify away from office properties, which have still not recovered from the pandemic.
Please comment or send an email if you have any questions.
Joe Baker, CFP®
Baker Asset Management, LLC
joebaker@bakerassemanagement.com
