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
Giants 400 | Aug 5, 2015
ENGINEERING GIANTS: Profits, revenue on the rise at U.S. engineering firms as economy sputters back to life
The vast majority of engineering firms are decidedly bullish on revenue growth for 2015, and profitability is nearing a six-year high, according to BD+C's 2015 Giants 300 report.
Giants 400 | Aug 4, 2015
GIANTS 300 REPORT: Top 64 Architecture/Engineering Firms
Stantec, HOK, and Callison RTKL top Building Design+Construction's 2015 ranking of the largest architecture/engineering firms in the United States.
Giants 400 | Aug 4, 2015
GIANTS 300 REPORT: Top 106 Architecture Firms
Gensler, Perkins+Will, and Kohn Pedersen Fox top Building Design+Construction's 2015 ranking of the largest architecture firms in the United States.
Giants 400 | Aug 4, 2015
ARCHITECTURE GIANTS: 21 practice management innovations from architecture Giants
Design firms have gone all out with management innovations in the last year. Check out which ones might work for your firm.
Architects | Aug 4, 2015
Frank Lloyd Wright School of Architecture closer to independent incorporation
The school is halfway to its first fundraising milestone, but is facing a major deadline at end of this month.
Industrial Facilities | Aug 3, 2015
Architect Jacques Rougerie envisions floating city to function as roving laboratory
The manta ray-shaped vessel will be completely self-sustaining, run on marine energy, and produce no waste.
Cultural Facilities | Aug 3, 2015
Funding needed for Washington's Desert Storm memorial
The National Desert Storm Memorial Foundation has a $25 million goal for the project.
Sports and Recreational Facilities | Jul 31, 2015
Zaha Hadid responds to Tokyo Olympic Stadium controversy
“Our warning was not heeded that selecting contractors too early in a heated construction market and without sufficient competition would lead to an overly high estimate of the cost of construction,” said Zaha Hadid in a statement.
Architects | Jul 30, 2015
The Lego Architect: Book offers simple how-to steps for recreating iconic buildings with Legos
The book features famous buildings accompanied with a photograph and drawing of the Lego model of the building, and a list of all the Lego pieces needed to complete a model of the building.
Transit Facilities | Jul 30, 2015
Snøhetta designs ring-shaped cable car station in Italian Alps
In Snøhetta’s design, two cylindrical rings embedded into the existing topography, each at different elevations, will be connected by a cable car. During the minute-long cable car journey, passengers can enjoy views of the city and of the Italian Alps.
