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Non-residential construction expected to plunge this year

The good news just keeps washing over the Caterpillar watchers this morning:

The American Institute of Architects sees such construction activity falling 11 percent this year and another 5 percent in 2010, it said in its semiannual industry forecast. The group cited falling company profits and the lack of credit to finance projects.

Spending on hotel construction is expected to decline by more than 20 percent this year and another 12 percent next year. Construction of retail, office and industrial facilities is seen falling by double digits this year, with the rate of decline slowing in 2010, the AIA said.

“This is not expected to turn around anytime soon, and it’s likely to get worse before it gets better,” AIA Chief Economist Kermit Baker said in a statement.

Institutional categories, such as churches, schools and healthcare facilities, are forecast to post smaller declines this year.

Safe to say that in a bear market, nobody believes in Santa Claus after the 15th of January.

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Tom Mangan posted at 9:22 am January 14th, 2009 |

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