This month marks three years since the shutdown in the United States for COVID-19, and the construction industry has since deeply felt the effects of the pandemic. Labor shortages, supply chain issues, and high costs of building materials slowed both new and ongoing projects for quite some time. As 2023 rolls on, we have seen an increase in construction starts that bode well for the rest of the year to come.

According to a recent report by Dodge Data & Analytics, total construction starts in February rose to a rate of $912.8 billion, a 6% rise since January. Due to a dropoff in January, starts are still 17% below their 2022 levels. Don’t write the first half of 2023 off just yet though, as some big projects show promise. 

Nonresidential building

Ground broke for the new Honda EV battery plant in Jeffersonville, Ohio, at the end of February. This $3.5 billion project contributed largely to the 218% increase in manufacturing construction starts in February. Another big project that broke ground in February was the $1.4 billion expansion of Concourse D at Hartsfield Jackson Airport in Atlanta. 

With projects of this size kicking off in 2023, the construction industry is looking up for infrastructure and manufacturing. This influx of data can help other construction companies provide more accurate quoting and bidding on new projects, improve timelines, reduce risks, and increase overall predictability in projects. 

Residential building

Multifamily building starts rose 22%, with overall residential starts increasing to $320 billion in February. Some notable projects that broke ground last month include a $350 million mixed-use building in New York and a $215 million Four Seasons condominium in Washington, D.C. 

This is a positive sign for the construction industry, as the housing sector is a significant driver of the construction industry. An increase in residential starts indicates the continued demand for housing and a growing population. With more housing comes a need for more grocery stores, shopping centers, office buildings, and much more. 

Challenges remain

While there is still a downturn in commercial and institutional construction as the industry struggles with high interest rates and weak economic growth, the effects should be mild. Commercial starts decreased by 2% in February due to a drop in office and parking structure starts, but that offsets gains in retail, hotels, and warehouse activity. 

Despite these challenges, the construction industry is rebounding as a whole. This indicates a positive outlook for the rest of 2023, particularly for the manufacturing and housing sectors. 

If you’re looking to break ground on a new project in the future, contact us today to learn more about our services and how we can help your project every step of the way. Check out our blog post “Four common mistakes to avoid in commercial construction projects” before you get started. To learn more about developing your digital marketing strategy, download our e-book about inbound marketing and how to implement it.