Construction Economic News

COMPOSITE OVERVIEW: The PSI surged by 19.5% in the week ending January 27th, 2024 to close at 156.6. The week’s severe increase was the result of surging project abandonments coupled with elevated levels of projects that have experienced either a delayed bid date or have been put on hold. The last time that abandoned activity was of such a magnitude was in late-April of 2020 as the COVID pandemic began shutting down the global economy. Unfortunately, the latest results only magnify the recent saw-tooth pattern observed in the data since late-October. Given that current macroeconomic conditions are improving thanks to slowing inflation, falling bond rates, and easing lending standards, multiple factors are now working in favor of owners and developers. As such it is doubtful that recent readings can be sustained. Rather, the surge in abandoned projects early this year may merely be a lagged response to the financial stresses experienced during 2023. The economics team at ConstructConnect will continue to carefully monitor stress conditions over the coming weeks.