from Mark Smith, Advocate, California Builders Alliance
Union Moves Work Stoppage At California’s Port Of Oakland To Day Shift
CNBC reported the Oakland International Longshore and Warehouse Union “is shifting a planned work stoppage to daytime hours June 20 at the already-congested Port of Oakland in California.” The change “is bad news for already-snarled supply chains,” because “the day shift is far busier than the evening shift,” and has logistics experts concerned. CNBC added that “the Port of Oakland has also seen a drop in exports and recently announced a partnership with the USDA to provide financial aid to agricultural exporters.”
Gas Prices Reach $5 Per Gallon
The New York Times reported, “Gasoline prices reached a grim milestone on Saturday, as the national average for regular gasoline reached $5 a gallon.” According to the AAA motor club, the new average is “up 60 cents from a month ago” and up $1.92 from a year ago. The Wall Street Journal attributed the surge in gas prices to the tightening of oil supplies that has followed economic sanctions against Russia over its invasion of Ukraine as well as the economic reopening. In an analysis, the Washington Post reported that the surge “has saddled all kinds of businesses with higher costs that will force them to raise prices on their customers and pull back on new investments. It risks a slowdown in consumer demand, as households cut back on other expenditures to accommodate their new fuel costs.” The Post added that while gas purchases “on their own make up only a relatively small portion of most families’ budgets...energy is so crucial to the functioning of the economy more broadly that the price increases bring along higher prices in many other sectors.”
Investors Fear Earnings Reports Will Send Stocks Lower
The Wall Street Journal reported that rising interest rates have sent stocks lower this year and with no signs that inflation will abate, investors are concerned that upcoming corporate earnings reports will lead to further declines. The Journal reported that a number of companies have indicated their second quarter results will be lower than expected and analysts have reduced their earnings forecasts across industries
Moody's: Recession less likely than many believe
With profits high and bank balance sheets in good shape, recession is not "the most likely path for the economy," according to Moody's Analytics Chief Economist Mark Zandi. Zandi also cites consumer savings as a positive factor, although he notes that recession predictions are likely to persist as the Federal Reserve continues to raise interest rates. Full Story: Construction Dive
Gains broad as construction adds 36K jobs in May
Construction unemployment reached its lowest level, 3.8%, in nearly two years as the industry added 36,000 jobs, according to the Bureau of Labor Statistics. The residential specialty trade contractor sector led the way with 11,700 jobs added, followed by heavy and civil engineering construction with 11,300 additional positions, residential with 5,000 and nonresidential building with 2,400.
Full Story: Engineering News-Record (tiered subscription model)
Dodge Momentum Index up 7% in May
An institutional gain of 9% in May and a rise of 6% in the commercial category pushed the Dodge Momentum Index to a gain of 7% for the month. The new reading of 176.2 left the index up 17% from a year before, with the commercial component 24% higher and institutional up 8%. Full Story: Dodge Data & Analytics
Biden seeks to encourage solar panels for infrastructure
More domestic production of solar panels is one goal of three new executive orders from President Joe Biden under the Defense Production Act. The action is aimed at increasing the supply of solar panels available to advance construction projects under the bipartisan infrastructure law. Full Story: Construction Dive
US agencies appoint infrastructure spending watchdogs
Every federal agency responsible for implementing the bipartisan infrastructure law now has a top official tasked with preventing fraud and wasteful spending, according to a budget official. The Biden White House is also demanding that agencies work with the inspectors general watchdogs similarly responsible for ferreting out misuses of funds. Full Story: Spectrum News
White House incentivizes stronger building codes, standards
The Atlantic hurricane season began Wednesday and the White House seized the opportunity to launch a National Initiative to Advance Building Codes, aiming to encourage adoption of new construction standards, reduce energy waste and make communities more resilient to the impacts of climate change. Through the initiative, the Biden administration plans to provide incentives and support for state, local, Tribal and territorial governments to adopt updated building codes and standards. The federal government will also “lead by example” and require its own new, large construction and modernization projects to have net-zero emissions. Adopting stronger building codes can help the U.S. meet decarbonization targets while saving consumers money, say advocates. “This is exactly what the federal government needs to be doing to start the modern building transition,” Building Decarbonization Coalition Executive Director Panama Bartholomy said in an email.
Can workers be recruited to fill infrastructure demand?
Training and apprenticeship programs around the US are proving their worth helping to fill employment gaps in the construction industry. However, as labor openings grow and major spending under the bipartisan infrastructure begins to kick in, experts question whether such programs can be developed fast enough to meet demand and where recruitment efforts can best be focused. Full Story: Governing
A $25.3 billion bill for projects, including storm and flood protection, ecological restoration and harbor dredging, passed easily in the House and now goes to the Senate, where a similar bill won committee approval last month. The House-passed Water Resources and Development Act would help fund 22 projects valued at $39.9 billion planned by the US Army Corps of Engineers. Full Story: Engineering News-Record (tiered subscription model)
Infrastructure funding in question as gas taxes go on holiday
A proposed House bill to suspend the federal tax on gasoline is up for debate as five states this year have already suspended their gas taxes. However, the moves are expected to do little to relieve the burden on consumers at the pump as gas prices nationwide near $5 a gallon, and the loss of revenue from this and -- longer term -- the adoption of electric vehicles is raising questions about infrastructure funding. Full Story: For Construction Pros
Google's planned Downtown West project advances
The San Jose, Calif., Planning Commission has cleared Google's plan to build a mixed-use village downtown on an 80-acre campus. The Downtown West project is expected to include as many as 5,900 housing units, 7.3 million square feet for offices, 500,000 square feet for shops and restaurants, and 15 acres of parks. Full Story: The Real Deal
$8M grant headed to SANDAG for rail bridge upgrade
The San Diego Association of Governments and the North County Transit District will provide a 42% match on an $8 million federal grant that will go toward an effort to replace a more-than-century-old timber bridge with a concrete one that will support a second set of railroad tracks. The project, on which construction is expected to begin in August 2023, is part of a larger effort to upgrade the coastal railroad corridor from San Luis Obispo to San Diego. Full Story: Railway Track & Structures
$1.35B project led by Mortenson, McCarthy gets OK'd
Construction of the $1.35 billion Gaylord Pacific Resort and Convention Center project in Chula Vista, Calif., has been approved by a $275 million public bond deal agreed upon by the city and the Port of San Diego. Mortenson and McCarthy Building will build the venue, which will include a new park and other improvements along with the 1,600-room hotel. Full Story: The Construction Broadsheet
Mark Smith
Advocate
California Builders Alliance
5370 Elvas Avenue ǀ Sacramento, CA 95819
Cell: 916.335.5072
Email: mark.smith@calbuilders.org
Email: mark@smithpolicygroup.com