Wednesday, November 26, 2008

Does a new administration mean a brighter outlook for the AEC industry?

Interesting question, to be sure. Some AEC industry experts believe that things will not improve any time soon, regardless of whether President Bush or President-elect Obama is in charge. And, clearly, the Architectural Billings Index for October being the lowest number since its inception gives credence to that argument.

Yet, it's pretty clear from the mounting number of trade industry articles that have been published since the November 4 election that many observers also believe that President-elect Obama will make infrastructure funding a priority, thus brightening the seemingly dreary prospects for the beleaguered industry.

According to a Reuters article published earlier this week, Obama told the Conference of Mayors that, "We are going to have to make sure that we are investing in roads, bridges, other infrastructure investment that lays the groundwork for long-term economic growth." In fact, according to the article, more than 4,500 infrastructure projects could begin immediately once funding shortfalls are rectified. In fact, many experts believe infrastructure projects will comprise a large part of the next economic stimulus package. The shortfalls in funding have forced officials to postpone repairing deteriorating bridges and roads for years, even though designs and permits are in place.

The stimulus plan could "absolutely change the scenario for companies that have been talking about laying people off," according to Associated General Contractors of America Chief Executive Stephen Sandherr in a Wall Street Journal article earlier this week.

Clearly, as evidenced by the daily fluctuations on Wall Street, we are in a time of great uncertainty. But there does seem to be some hope on the horizon for the AEC industry. We shall see.


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