JLL: Construction Industry Likely to See Positive 2024

(Components of Construction Costs and Spending, Courtesy of JLL and data via JLL Research, Bureau of Labor Statistics, U.S. Census Bureau)

JLL, Chicago, released its U.S. and Canada Construction Trends 2024 forecast, positing that the industry will have a positive 2024, but also acknowledging existing challenges.

“The industry is ready to successfully meet the challenges of 2024,” said Todd Burns, President of Project and Development Services, Americas for JLL. “With immense housing needs, return to office strengthening and federally backed infrastructure and manufacturing accelerating, the industry is poised for growth despite challenges.”

In the U.S., JLL anticipates construction spending to remain stable, with some differences by sector.

For 2024, materials costs are anticipated to increase by 2-6%, with a variation in terms of type. For example, continued shortages in the electrical market may affect pricing and supply.

Wages are expected to grow by 3-5%. Persistent limited labor availability will likely set a price floor for construction, keeping costs growing.

For 2024, total construction costs are expected to rise by 2-4%.

JLL acknowledged some complications of declining starts and rising interest rates, but noted that additional public spending on infrastructure and manufacturing construction will lead to a near wash for total value put in place in 2024.

Additionally, supply chain pressure should remain manageable in 2024, after improving in 2023–the Global Supply Chain Pressure Index hit a historical low in October.

“For a successful year ahead, it is imperative that industry leaders keep three strategies in mind,” Burns said. “They must know their people in order to retain talent, know their projects to understand what technologies can be used to assist and know their markets in order to anticipate what is coming next and plan for success.”