AKRON — The one thing that dominates the outlook for the construction industry going forward is the pending injection of billions of dollars in government funding under the recently passed Infrastructure Act.
Dodge Construction Network forecasts an increase of 32.5% in non-building construction value year-over-year through 2026 — that forecast would be 14.9% without the bill's passing, according to Dodge Chief Economist Richard Branch.
Like most industries, the construction market is facing three challenges in the new year: price, people and productivity.
"All those projects sitting in planning are taking longer to get through, and while construction starts will grow in 2022, that growth is expected to be modest," Branch said. "... It's very clear, as we put all of this together, that if not for the challenges, shortages and prices that we're currently facing, construction activity would be much stronger than it currently is."
The government funding "will undoubtedly drive construction activity and therefore push demand — new projects mean more equipment and older equipment being run for more hours, in turn more tires will be needed," said Paul Hawkins, senior vice president, aftermarket sales, North America for Titan International Inc.
"While this is a very large dollarized stimulant into the economy, at this time it is difficult to determine the direct impact it will make on the construction tire market," added David Smith, operational marketing manager for infrastructure and construction at Michelin North America.
"Our anticipation is that as recipients receive funds, that we will see a trickle effect into the tire market as early as the first quarter of 2023, maybe even fourth quarter of 2022."