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80 • ROCK products • March 2018 www.rockproducts.com ECONOMICS For all of 2017, total construction starts grew 3 percent to $745.9 billion, which followed the 6 percent increase reported for 2016. The full-year 2017 gain was dampened by a 35 percent downturn for the electric utility/gas plant cate- gory. If electric utilities and gas plants are excluded, total construction starts for 2017 would be 5 percent higher than the corresponding amount for 2016. The 3 percent increase for total con- struction starts at the national level in 2017 was the result of mixed behavior by geography. The Northeast climbed 17 percent, aided by strong gains for its institutional building sector and natural gas pipelines, while more moderate total construction growth was reported for the South Atlantic, up 6 percent; and the West, up 3 percent. Total construction declines in 2017 were reported for the South Central, down 3 percent; and the Midwest, down 8 percent. Highway and bridge construction starts grew 7 percent. The top five states ranked by the dollar amount of new highway and bridge construction starts, with their percent change from the previous year, were Texas, down 20 per- cent; California, up 9 percent; Virginia, up 180 percent; Florida, up 23 percent; and Pennsylvania, up 32 percent. "On a quarterly basis, growth in 2017 was reported during the first and third quarters, while activity retreated during the second and fourth quarters, continu- ing the up-and-down pattern around an upward trend that was present during 2016," stated Robert A. Murray, chief economist for Dodge Data & Analytics. "On the positive side for 2017, institu- tional building assumed a leading role in keeping the nonresidential building expansion going, reflecting elevated activity for transportation terminal starts and further improvement by educational facilities. Manufacturing plant construction starts strengthened, ending a two-year decline, and commer- cial building was able to stay close to its heightened 2016 amount. Residential building in 2017 showed more growth for single family housing, offsetting a downturn for multifamily housing. And, public works construction in 2017 was able to strengthen, helped by the start of several very large pipeline projects and a moderate gain for highway and bridge construction." "The construction industry over the past two years has made the transition to a more mature stage of expansion, characterized by slower rates of growth for total construction compared to the 11 percent to 13 percent yearly gains during the 2012-2015 period," Murray indicated. "For 2018, the construction expansion is anticipated to continue at a modest pace. The tax reform pack- age is expected to provide a near term lift to overall economic growth, and the likely beneficiaries would be commercial building and multifamily housing. Fund- ing support for institutional building will come from the state and local bond mea- sures passed in recent years. Passage of a new infrastructure program at the federal level could be a plus for public works, although the impact at the con- struction site is likely to be felt more in 2019 than in 2018, as the program would feature incentives to boost fund- ing from state, local and private sources." Nonresidential Building For 2017 as a whole, nonresidential building advanced 7 percent to $270.7 billion. The institutional building cate- gories as a group climbed 14 percent, a stronger gain than the 9 percent increase in 2016. Transportation terminal work had a banner year in 2017, as new con- struction starts soared 121 percent. Transportation terminal projects that reached groundbreaking were led by two projects at LaGuardia Airport in New York – the $4.0 billion Delta Airlines Terminal and the $3.4 billion Central Terminal replacement. The next three largest projects were the $1.9 billion Delta relocation to Terminals 2 and 3 at Los Angeles International Airport, the YEAR-TO-DATE CONSTRUCTION STARTS (Unadjusted Totals, in Millions of Dollars) 12 Mos. 2017 12 Mos. 2016 % Change Nonresidential Building $270,701 $253,330 +7 Residential Building $302,018 $297,202 +2 Nonbuilding Construction $173,190 $176,560 -2 Total Construction $745,909 $727,092 +3 Source: U.S. Dept. of Commerce New Construction Starts for 2017 Advance 3 Percent Highway and Bridge Construction Starts Grew 7 Percent in 2017, Strengthening After a 9 Percent Decline in 2016. By Mark S. Kuhar