The U.S. transportation infrastructure market is expected to grow at least 5% next year, according to the annual economic forecast released Dec. 4 by the American Road & Transportation Builders Association (ARTBA).
“The real market growth for 2020 is being fueled by increased transportation investments from federal, state, and local governments,” ARTBA Chief Economist Dr. Alison Premo Black, who conducted the analysis, said in a statement.
Total domestic transportation construction and related-market activity in 2020 should reach $300.4 billion, up from 2019’s $286.5 billion, after adjusting for project costs and inflation. The transportation construction market grew by 8% in 2019 compared to 2018, driven largely by gains in highway, street, and pavement work, which grew by $9.6 billion to $73.1 billion.
One of the key findings in the forecast shows that the real value of public highway, street and related construction investment by state transportation departments and local governments—the largest market sector—is expected to increase by 6% to $77.5 billion after growing 15% in 2019. It projects that construction work on private highways, bridges, parking lots, and driveways will increase from $69.1 billion in 2019 to $71.8 billion in 2020 and will continue to grow over the next five years as market activity increases in those sectors.
The forecast also notes that the pace of bridge and tunnel construction work stayed flat in 2019 and is forecast to grow by $800 million (3%) in 2020. Bridge and tunnel market activity fell slightly from $28.8 billion in 2018 to $28.6 billion in 2019, after adjusting for project costs and inflation.
One variable, Black says, is the outlook for the reauthorization of the FAST Act transportation law, due in 2020, and the ability of Congress to find additional revenues to support the Highway Trust Fund (HTF). Any project delays because states are concerned about whether the next federal surface transportation bill is completed in a timely matter could temper 2020 market growth, Black added.
Overall, transportation construction market activity is expected to increase or be steady in about half of the states, the ARTBA analysis shows. Some of the largest markets expected to remain stable or grow include Texas, California, Illinois, New York, Florida, North Carolina, Washington, Minnesota, Michigan, Arizona, and Wisconsin.
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SOURCE: ARTBA
