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Last year ended on a sour note for our Gulf Coast renovation and construction company. We’re not new kids on the block; my husband and I have been building our business since 2000. Despite a good reputation and a full portfolio, the last quarter of the year failed to stave off dreaded layoffs. We ended the year with fewer employees, but just one month later things are looking up. As the company’s leadership, it’s up to us to set the tone for the upcoming year. I’ve done my research, tapped into my intuition and listened to my competitors too. These sources have given me a rosier than expected forecast.
Here’s what pushed me toward an optimistic view of the construction market.
It’s an election year and the money is printing.
According to a recent article by MoneyNews.com, this phenomena happens every election year. Large amounts of money is printed to “juice up” the economy. Happy people are voting people. However, I suppose that logic could move the other way too. Two, possibly three rounds of quantitative easing (that’s government-speak for printing money) are scheduled for release in 2012. That’s more money for lenders and creditors which ultimately helps consumers looking for home improvement and construction loans. That’s good news for the construction market! Even a small job can cost a few thousand dollars, which is not an amount most homeowners have laying around. Most of our clients depend on loans to make their construction project dreams come true.
Green initiatives are going to make a greater impact.
I’ve seen projects like solar paneling, installing Energy Star appliances and other green initiatives begin to increase. Tax breaks for green construction projects make these improvements possible for homeowners who want to save money and go green. We had several inquiries about those last year, many of which followed up with estimates. Fingers crossed but I am optimistic concerning this sector of our construction company. Also, who knows what further initiatives the Obama administration will offer during this election cycle?
Tighter Alabama laws improve our reputations.
Once a month, I meet with a local business group. Many members, including myself, work in the construction industry. At a recent roundtable, we reviewed last year and we discussed the upcoming changes in Alabama’s construction licensing law. In 2012, electrical contractors must have a local and state license. While none of us are big fans for more government involvement in our businesses, we couldn’t help but think this move was a good one.
Unfortunately, as it stands now anyone with an impressive tool belt and nice truck can pass themselves off as a construction worker. (Imagine someone buying a white lab coat and stethoscope and then pretending to be a doctor.) It does happen, though, and many unknowing consumers have made serious mistakes trusting unlicensed “contractors.” The tighter licensing requirement will hopefully cut away some of the pretenders and improve relations with consumers. The Alabama legislature has launched a PSA campaign reminding consumers to ask to see licensing documents, especially for electrical contractors. Consumers can call the state too and get the skinny on their contractor.
For all these reasons, I’m optimistic about the construction market. I think 2012 is going to be a good year!