Three recent reports gauging the health of the construction industry in 2002 are all optimistic about the resilience of the sector during the recession.

The national construction forecast report by Cahners' Associated Construction Publications looks with promise to the continued strength of non-residential building segments.

While Sept. 11 events helped slow applications for new permits and delayed completion of some projects in 2001, the report shows a slow-but-sure rising outlook for the next 12 months.

According to the report, economist Daryl Delano says construction will experience a shortfall but should come back quickly.

"The weak economy that became emphatically recessionary in the wake of the terrorist attacks caused many firms to re-evaluate, postpone and ... actually cancel some planned construction projects," he said.

Lending institutions have tightened requirements, adversely affecting investments in construction, particularly commercial building, Delano said. However, he predicts a short-lived downturn in the sector.

"Recessions do not last forever ... and there's every likelihood that the current one will be a not-too-distant memory at this time next year," he said.

The national outlook for construction "will not be as bad as everyone thinks," said ACP editor Greg Sitek, "and there are some regions where the projections are better than last year's."

Total non-residential construction is expected to be down 2.35 percent at the end of 2002, with transportation and power/utility sectors showing gains. Water/sewer, building, military and civil construction show small losses, Sitek said.

Total non-residential spending is forecast at $235.13 billion, down about $5.67 billion from 2001.

The transportation sector is expected to lead in growth by far, with estimates totaling a 9.75 percent upswing.

In another report, the U.S. Department of Commerce released figures early in the year that showed construction spending "on the mend" at the end of 2001. The rate of public and private spending on construction slowly rose in October and November, each month posting a 0.8 percent gain.

Construction spending rose $6.5 billion in November, to $865.1 billion. In a survey by the Department of Commerce in December, finance experts expected spending for that month to be flat.

The National Assn. of Home Builders' Housing Market Index rose four points in January, to 61. Most optimism fell to single-family home sales expectation, which rose six points, to 67. The results are an indication of builders' optimism that sales will soon return to pre-September 11 levels, according to NAHB. A number over 50 means that more builders view sales conditions as "good," rather than "poor."

NAHB president Bruce Smith credited improved consumer confidence, continued confidence in a home as a good investment and favorable mortgage rates for the upswing. According to Smith, the figures show not only a rebound from September 11 but also an upswing from the falling indicators present even before the tragedy. The HMI is derived from a monthly survey of builders.

The Housing Market Index had been as low as 47 in October, 2001, but rose eight points in December. NAHB also issues an index of prospective buyer traffic, a gauge of consumer confidence in the housing market. The index rose four points to 50, its highest point since February, 2000, Smith said.

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