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Market sends mixed signals

Nov. 1, 2004

There was an increase in highway projects awarded in September, but contractors are still experiencing an increase in material

There was an increase in highway projects awarded in September, but contractors are still experiencing an increase in material costs.

There was an increase in highway projects awarded in September, but contractors are still experiencing an increase in material

There was an increase in highway projects awarded in September, but contractors are still experiencing an increase in material costs.

The American Road & Transportation Builders Association (ARTBA) reported that federal state and local transportation agencies awarded 1,960 highway construction projects valued at nearly $2.38 billion in September. At the same time last year 1,270 projects were awarded valued at nearly $1.96 billion. The surge in highway contract awards brought the year-to-date value to $24.88 billion, just above the $24.76 billion awarded through September 2003.

Lower backlogs and higher prices, however, could impact the market next year. The latest ARTBA quarterly market conditions survey revealed that although 51% of contractors reported working at 90% of capacity or more, other respondents are struggling with a variety of issues, including the amount of work let by state departments of transportation.

Contractors are split on their business outlook for the next 12 months--59% are making plans based on sluggish growth or recession; 41% are expecting normal or above-normal growth.