Houston is the largest city in Texas, making it a prime location for construction companies looking to capitalize on the recent population boom and growing economy. With many businesses moving to the area and a vibrant housing market, construction services are in high demand.
Understanding the forecast for construction in Houston can help you prepare your construction business for continued growth and success.
HOUSTON KEEPS GROWING
Houston is experiencing some of the fastest growth in the country, with new road improvement plans and residential and commercial projects planned for the city.
- Road improvements: As part of the state’s Unified Transportation Program, the Houston area will see a 10-year, $85 billion plan to improve roads and bolster the economy. Specific goals include expanding the Gulf Freeway as part of a broader development of I-45.
- Fastest growing city by 2060: A new report projects several metro areas, including Houston, will experience over 50% population growth in the coming decades. Houston’s projected population growth of 62.2% from 2022 to 2060 is the 20th highest of all 384 U.S. metro areas. Employment is also projected to grow at 76.9% by 2060, indicating the need for more housing, infrastructure, and retail spaces.
- New Houston-area projects: The coming years will see several new construction projects in Houston. These include 1550 on the Green, Buffalo Bayou East, the Ismaili Center, and TMC Helix Park. Many of these projects will require construction expertise in residential buildings, retail construction, and skilled construction services for entertainment and sports structures.
CONSTRUCTION MARKETS RECOVERING POST PANDEMIC
The Houston construction market shows signs of positive recovery post-pandemic, with growth rates returning to pre-pandemic levels. According to a Dodge Data & Analytics report, the total value of Houston area commercial and multifamily construction projects in 2022 was up 41%, valued at $8.7 billion.
The city’s infrastructure is also undergoing significant development, with major projects like the $1.36 billion expansion of Houston’s George Bush Intercontinental Airport and the $1 billion expansion of the Houston Ship Channel underway, aiming to increase the channel’s depth and width, enabling larger vessels to navigate the waterway more efficiently. These projects are expected to boost the local economy and job market significantly.
The pandemic has also prompted a shift towards more technology-driven construction methods, including virtual reality and drones for project planning and execution. Building Information Modeling (BIM) has become increasingly popular, allowing for more efficient and collaborative planning and design. Autonomous equipment and robotics are also becoming more prevalent in construction sites, enhancing safety and efficiency.
Mobile apps and cloud-based software are also used to track project progress, manage resources, and streamline communication among team members. These technological shifts will drive further growth and innovation in the Houston construction industry.
PREPARING FOR INDUSTRY SHIFTS
While planning for growth in the Houston construction industry is a good business strategy, it is also wise to prepare your company for any shifts in the market. Here are some tips on how to ensure your company stays successful.
- Take inventory of your fleet. Effective fleet management can reduce downtime, increase productivity, and provide a competitive advantage by ensuring equipment is available and ready for increased demand or adapting to project changes. To effectively manage your inventory, track usage, conduct regular maintenance, and plan for replacement or upgrades.
- Build a backlog of work. A backlog of 6 to 12 months’ worth of work can provide stability and a competitive edge. Strategies include diversifying services, targeting long-term projects, and nurturing client relationships through excellent communication and customer service.
- Retain talent. In Houston’s construction industry, employment reached a record high in 2023, yet a shortage of skilled labor persists. According to a recent report by the Associated General Contractors of America, 84% of Texas construction firms struggle to fill salaried and hourly positions. Houston construction businesses must offer competitive wages and other incentives to retain the best workers and survive future economic challenges.
- Know your costs. Inexperienced companies face narrow profit margins due to escalating material and labor expenses, intricate projects, and time constraints. Understanding your overall project costs, such as overhead and labor, is crucial for accurate estimates and increased profits.
MONK JCB YOUR RESOURCE FOR HEAVY CONSTRUCTION EQUIPMENT
Prepare your construction business for success with Monk JCB. Based in Southeast Texas, we are a heavy construction equipment retailer authorized to sell high-quality JCB equipment. Our wide selection of inventory ensures that your construction company has the necessary equipment to build new businesses, homes, and infrastructure in the Houston area.
Contact our team using our convenient online form to learn more about our JCB equipment and how you can get the machinery you need for your business.
