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Uncertain Outlook

Copyright © 2013 Albuquerque Journal

Construction contractors in New Mexico tend to be a little more uncertain about their work prospects this year compared to their peers across the country, according to the results of a survey by the Associated General Contractors of America.

More than half of all the contractors surveyed in New Mexico said they didn’t know whether they will be adding or laying off employees in 2013, compared to just 32 percent of contractors nationwide.

On the bright side, 24 percent of the contractors in the state expect to add employees in 2013, four times the 6 percent that said they planned layoffs, according to the survey-based report released Monday. Nationwide, 31 percent of contractors planned to add staff this while 9 percent planned staff cuts.

Both in New Mexico and nationwide, construction hiring will be modest with the majority of firms expecting to add 15 or fewer workers during the course of the year, AGC CEO Stephen Sandherr said in a conference call with the media.

“While the outlook for the construction industry appears to be heading in the right direction for 2013, many firms are still grappling with significant economic headwinds,” he said.

Maryland stood out among the 30 states with large enough survey samples for the optimism of its contractors, 56 percent of whom planned to add employees and none planning layoffs. At 14 percent, South Carolina had the lowest percent of contractors planning to add staff.

Among New Mexico’s neighboring states, 22 percent of Arizona’s surveyed contractors plan to add employees while 9 percent plan cutbacks. In Colorado, 42 percent plan to add while 4 percent plan cuts. In Texas, 34 percent plan to add while 7 percent plan cuts.

The recession was particularly hard on the construction sector. One-fifth of all job losses nationwide were in construction. In the Albuquerque metro area, it’s closer to one-third of all job losses.

In 2012 there were some signs of turning the corner.

Investment in construction projects rose 7 percent last year, although the increase translated into a tiny 0.3 percent increase in construction jobs, noted AGC chief economist Ken Simonson. Data on hours worked by construction workers point to contractors using existing staff to handle increases in projects.

“Firms have been able to move people out of the office or shop and into the field,” he said.
— This article appeared on page B1 of the Albuquerque Journal