The American Institute of Architects (AIA) released a comprehensive report, which concludes that the major obstacle holding back job creation in the U.S. is the persistent lack of construction financing, despite record low interest rates.
“This report should lay to rest any doubt about what is a key source for holding back job creation in the United States,’ said Kermit Baker, chief economist of the AIA. “It is the lack of financing especially to the design and construction sector, which accounts for $1 in $9 of U.S. Gross Domestic Product.”
The report found:
- The share of projects stalled due to financing problems through August 2011 has almost doubled since 2008
- One-in-five stalled projects are directly resulting from financing problems
- Financing problems account for a higher share of stalled projects in the education and multi-family sector
- More than 25% of projects reported as stalled due to the credit crunch could qualify for LEED, Green Globes, or other green certification status
- Financing issues are less of a factor holding back projects in the manufacturing, private healthcare, and retail environments
“Whatever, the reason – be it over-regulation, the threat of a double-dip recession or the reluctance to have too many loans on the books, lenders are just not lending to a major job-producing sector of the American economy,” Baker noted. “Until more credit is extended, the potential of non-residential construction to promote greater levels of economic growth will not be realized.” BD+C
Related Stories
Architects | Aug 19, 2015
Despite dip, architecture billings remain strong
The American Institute of Architects (AIA) reported the July ABI score was 54.7, down a point from a mark of 55.7 in June.
Architects | Aug 17, 2015
Historic power plant converted to modern offices in Minnesota
A landmark power plant in Owatonna, Minn., damaged in a 2010 flood has new life as the headquarters of Owatonna Public Utilities following a renovation by architects Leo A. Daly.
High-rise Construction | Aug 11, 2015
Calatrava's Turning Torso wins CTBUH's 10 Year Award
The 623-foot, 57-story tower was the world's first twisting skyscraper. Completed in 2005, the building, designed by Santiago Calatrava, rotates 90 degrees along its height.
Architects | Aug 11, 2015
Architecture firm compensation trending upwards
Latest AIA compensation survey finds average compensation for staff positions up 3.5 percent from early 2013
Architects | Aug 11, 2015
12 architecture schools join NCARB's 'speedy path to licensure' program
For architecture students, a license to practice may soon be available as early as graduation day
Architects | Aug 10, 2015
HDR expands its Canadian presence through merger with CEI Architecture
Public-private partnerships are expected to be one of the combined entity’s strengths.
Retail Centers | Aug 10, 2015
Walgreens’ flagship in Hawaii harkens back to the island’s fishing culture
A house where canoes were made served as the model for this drug superstore’s design.
Giants 400 | Aug 7, 2015
GOVERNMENT SECTOR GIANTS: Public sector spending even more cautiously on buildings
AEC firms that do government work say their public-sector clients have been going smaller to save money on construction projects, according to BD+C's 2015 Giants 300 report.
Giants 400 | Aug 7, 2015
K-12 SCHOOL SECTOR GIANTS: To succeed, school design must replicate real-world environments
Whether new or reconstructed, schools must meet new demands that emanate from the real world and rapidly adapt to different instructional and learning modes, according to BD+C's 2015 Giants 300 report.
Giants 400 | Aug 7, 2015
MULTIFAMILY AEC GIANTS: Slowdown prompts developers to ask: Will the luxury rentals boom hold?
For the last three years, rental apartments have occupied the hot corner in residential construction, as younger people gravitated toward renting to be closer to urban centers and jobs. But at around 360,000 annual starts, multifamily might be peaking, according to BD+C's 2015 Giants 300 report.
