Where is the economy headed?
The consensus surrounding an economic downturn in 2023 appears to be fracturing. According to a recent Morning Consult survey, almost one third of respondents are actively preparing for an economic downturn. Meanwhile, strong employment growth and good news in the housing market are causing some analysts to reconsider their fears. However, inflation continues to be a sore spot, unexpectedly rising 0.5% in January. In the construction sector, strong demand continues to be tempered by labor market shortages and higher supply costs.
Governor Christopher J. Waller: “We began raising interest rates in March 2022 and shrinking our securities holdings in June in order to bring inflation down to our 2% target. Today I thought I would spend a few minutes taking stock of the year behind us and talking about what's next.”
Deep Dive: A Case for Cautious Optimism
Labor and Delivery: Workforce Shortages Threaten Project Deadlines
A report prepared by Associated Builders and Contractors that predicts the need for almost a half-million additional construction workers to meet demand. But according to a recent survey conducted by the Associated General Contractors of America, 80% of construction firms surveyed indicated they were having a hard time filling some or all positions, and 70% indicated an insufficient supply of workers or subcontractors was one of their biggest concerns for 2023. And with construction wage increases outpacing the economy on the whole, there are strong incentives to maximize productivity and retain top talent — or lose out on bids.
According to the Bureau of Labor Statistics (BLS), total non-farm payroll employment surged by 517,000 in January, led by the growth in the leisure and hospitality, professional and business services, and healthcare industries. The unemployment rate remained relatively unchanged at 3.4%. Employment in the construction industry increased by 25,000 jobs in January, with specialty trade contractors adding 22,000 jobs. Nonseasonally adjusted unemployment in the construction industry was 6.9% in January, down from 7.1% in January 2022.
Overview of Selected Materials Costs (January 2023, U.S. Bureau of Labor Statistics PPI)
Notwithstanding recent raw material cost fluctuations, the electrification of consumer vehicles has drastically reduced the cost of lithium ion batteries per kilowatt hour over the last 10 years. Combined with EPA federal greenhouse gas emissions standards, the trend is clear: For consumers, the future is electric. For the jobsite, the picture is just now coming into focus.
Smaller machines, such as mini excavators, pumps and small tractors are excellent candidates for electrification in the short term. Additionally, on-site energy storage systems can provide recharging capabilities for electric machines while load balancing diesel generator output. An electric fleet has additional benefits as well — reduced maintenance costs, quieter operation for indoor applications and, of course, zero emissions on the jobsite.
EquipmentShare offers a variety of electric power solutions and equipment to help your jobsite stay quiet, clean and productive. Get started with a rental today.