The construction market in Salt Lake City is declining this year, accelerating from a minor 1.7% drop last year to a 5.5% drop this year.
In 2021, this decline will accelerate further to a 12.6% drop. This year’s decline is being pushed by a 19.8% fall in commercial construction as well as significant declines in the education and manufacturing sectors. Next year’s acceleration will be driven by a severe 17.5% drop in residential construction. The market is expected to rebound in 2022 with strong growth. Overall construction market volume will rise by 7.1% while residential construction jumps by 12.3% and education construction by 13.2%.
Despite the downturn in construction activity and the recession, employment in the construction industry has continued to rise in Salt Lake City. Construction labor has shown a consistent pattern of growth since 2013 that is not showing serious signs of breaking. This will put significant downward pressure on price escalation when paired with the declining construction volume. Escalation is expected to be relatively low this year and next, despite the pandemic’s and recession’s adverse effects on supply chains and productivity levels. Once the market begins to rebound, escalation will be pushed upwards; but if current patterns hold, then growing construction labor will keep prices in check.