from Mark Smith, Advocate, California Builders Alliance
Fed pauses rate hikes, signals more tightening to come
The Federal Reserve has held its benchmark interest rate steady at about 5% during a policy meeting this week, the first such decision since March 2022. Policymakers' forecasts suggest the Fed could lift rates twice more in 2023. A statement from the Federal Open Market Committee notes that pausing rate increases "allows the committee to assess additional information and its implications for monetary policy."Full Story: The Associated Press The New York Times Bloomberg NBC News
CPI for all items rises 0.1% in May; shelter and used cars and trucks up
In May, the Consumer Price Index for All Urban Consumers increased 0.1 percent, seasonally adjusted, and rose 4.0 percent over the last 12 months, not seasonally adjusted. The index for all items less food and energy increased 0.4 percent in May (SA); up 5.3 percent over the year (NSA).
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PPI for final demand declines 0.3% in May; goods fall 1.6%, services increase 0.2%
The Producer Price Index for final demand declined 0.3 percent in May. Prices for final demand goods fell 1.6 percent, and the index for final demand services increased 0.2 percent. Prices for final demand moved up 1.1 percent for the 12 months ended in May.
Construction employment up year over year in April
In the 12 months through April, 42 states increased construction employment -- Texas and New York were at the top -- although only 24 states did so in April compared with March, according to federal data analyzed by the Associated General Contractors of America. "The fact that employment dipped in April in half the states may reflect an inability to find qualified workers at a time of record-low construction unemployment, not a slowdown in demand," AGC Chief Economist Ken Simonson says. Full Story: The Mecklenburg Times (Charlotte, N.C.) (6/14)
Agency pursues far-out infrastructure solutions
The White House has created the Advanced Research Projects Agency -- Infrastructure. The agency aims to develop innovation "well beyond something that is in the planning horizon for even the most forward-looking engineering company or state government," Transportation Secretary Pete Buttigieg .Full Story: The Verge
Electric could become norm for construction equipment
Electric construction equipment is expected to become the standard, given that battery run time has increased to four to eight hours and that electric vehicles have no friction-generating parts that might break, unlike piston engines, says David Knight, CEO of mobility and energy tech firm Terbine. Knight also cites improved tax credits for EVs, as well as carbon credits. Full Story: Electrek
AI is here to supplement, not take, construction jobs
Contractors are looking at artificial intelligence, especially to help with logistics, safety and preconstruction, in a new way as it becomes more available in the construction industry. "Where we're looking at robotics, for example, isn't to take jobs away from craftsmen but to supplement our workforce," says Jon Pahl, corporate innovation director at Nabholz Construction. "Maybe we can use robotics, for example, to help keep workers out of harm's way to do high-risk tasks." Full Story: Talk Business & Politics (Little Rock, Ark.)
FAA bill with $20B in airport grants clears House panel
The House Transportation and Infrastructure Committee has approved a five-year reauthorization spending plan for the Federal Aviation Administration that includes $20 billion in airport construction grants. "We are also excited by the price adjustment clauses included in the House measure, which will protect firms -- particularly small and [disadvantaged business enterprise] firms -- from being squeezed by rising materials costs," says Brian Turmail, vice president of public affairs and strategic initiatives at the Associated General Contractors of America.
Full Story: Engineering News-Record (tiered subscription model)
CPI increase reaches 2-year low at 4%
The consumer price index increased 4% year over year in May, marking the lowest increase since March 2021, according to Labor Department data. The CPI rose 0.1% month over month, while core inflation climbed 0.4% month over month and 5.3% year over year. Full Story: CNBC (6/13), The Wall Street Journal
Investment firm optimistic on multifamily projects
Banks may be leery of other construction sectors, but the multifamily market remains strong, says Bernie Wasserman, president of Participant Capital Advisors, which recently rolled out a $250 million fund for multifamily development in the Sun Belt region. "If somebody's generally coming to provide capital to the real estate market, multifamily is where they are most comfortable," Wasserman says. Full Story: Multifamily Dive
Excavators in demand amid construction surge
Sales of versatile excavators from companies such as Deere, CNH, Caterpillar and Komatsu are booming as construction companies spend more on equipment amid labor shortages and a surge in building and infrastructure projects. Sales rose 23% in 2022 from a year before, according to consulting firm Off-Highway Research, and a further 5% gain is predicted for this year as major manufacturers plan new and upgraded models.
Full Story: The Wall Street Journal
Report: Automation of sub management could improve
Just 34% of general contractors responding to a recent survey by Dodge Construction Network said they automate fewer than half of their subcontractor management processes, and just 9% of companies plan to automate OSHA compliance and tier vendor management within the next 12 months. However, 30% of GCs indicated plans to use automation for subcontract scheduling, change orders and payment applications. Full Story: Dodge Data & Analytics
I-405 project in Calif. expected to finish this year
This year is expected to be the final year of a massive and challenging Interstate 405 improvement project in Orange County, Calif. The $2 billion project adds one lane in each direction over a 16-mile stretch and two lanes in each direction over a more congested section. The process has been burdened by difficulties, including a redone environmental review that required hundreds of meetings. Full Story: Engineering News-Record (tiered subscription model)
Google gets approval for massive Calif. redevelopment
The Mountain View, Calif., City Council has approved Google's proposal to build a 153-acre neighborhood in an area currently occupied by offices. The project, expected to take 30 years to be fully built, includes 7,000 high-density residential units and 26 acres of green space. Full Story: KPIX-TV (San Francisco)
Nev. lawmakers OK stadium funds for relocation of A's
The Nevada Legislature has passed legislation to fund a portion of a $1.5 billion stadium with a retractable roof for the MLB's Oakland Athletics, which aim to relocate to Las Vegas. The state would contribute $380 million to the cost. Full Story: The Associated Press
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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
