
Charts and Diagrams
Construction spending in New York City is expected to reach $16.4
billion in 2000, a 38 percent increase from 1999 when spending totaled
$11.9 billion. In 1995, total construction spending stood at just
$9.2 billion. According to analyses of public and private forecasts,
the Building Congress anticipates construction spending will remain
high for several more years, averaging about $16 million through 2003.

Public sector construction in New York City is expected to rise
to $8.8 billion in 2000, which is up from $6.3 billion in 1999.
Since 1995, dollars spent on public construction has varied, averaging
about $5.7 billion per year. Though fluctuations from 2001 through
2003 are also projected, average annual construction is expected
to exceed $8.2 billion.

Construction industry employment in New York City is expected to
exceed 120,000 in 2000, up from 113,600 last year. In 1995, employment
stood at 90,200 and has been rising each year since. Based on projected
construction volume, by 2003 the need for construction workers could
outstrip supply by 30,000 or more. A key industry challenge is how
this shortfall will be addressed.
*Includes field and office personnel.
Residential construction in New York City is expected to exceed
16,000 units in 2000, up from just over 12,000 in 1999 and more
than three times the number added in 1995. Construction has risen
steadily in the last four years and is expected to continue increasing
through 2003.
Non-residential construction in New York City is expected to exceed
14 million square feet in 2000, up from 10.8 last year and 5.4 million
in 1995. After topping 6 million square feet in 1996, construction
rose to nearly 10 million in 1997, followed by more than 8.5 million
in 1998.
In 1999, infrastructure projects accounted for 52.8 percent ($6.3
billion) of all construction spending while non-residential construction
accounted for 31.8 percent ($3.8 billion) and residential construction
accounted for 15.4 percent ($1.8 billion). By 2003, infrastructure
spending is estimated to account for just 47.2 percent of the total
with 35.4 percent on non-residential construction and 17.4 percent
spent on residential projects.
While spending is expected to rise in all three sectors, the average
annual rate of increase for infrastructure construction (6.7 percent)
is expected to lag behind residential (11.0 percent) and non-residential
(10.3 percent) building activity.
About Construction Outlook
New
York City Construction Outlook was prepared by the New York
Building Congress and the New York Building Foundation with
the assistance of Urbanomics and includes analyses of construction
reports and forecasts by F.W. Dodge as well as a review of
public capital expenditures and budgets/plans at the City,
State and Federal levels.
![]() | New York Building Congress The New York Building Congress is a non-partisan public policy coalition of businesses, labor, associations and governmental organizations representing the design, construction and real estate interests of more than 150,000 individuals. Advocating economic Analyzing the Communicating the industry’s integral role in a healthy New York City |
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![]() | New York Building Foundation The New York Building Foundation was formed in 1998 to augment the long-term growth and well-being of the industry through a program of research, educational and philanthropic activities. Examining the Highlighting Assisting tomorrow’s Encouraging industry |
Sources |
Record Construction
Highest
Levels of Construction Spending and Employment Since 1960’s
New York City is in the midst of a building boom the likes
of which have not been seen since the 1960’s. While construction
activity has been on the rise for a number of years, it picked
up considerable steam in 1999 and 2000.
Construction spending has risen across the board — from
high-rise office towers and non-residential developments to
housing and schools. This dramatic surge in building and development
is a clear sign that New York City is continuing to add jobs,
tax revenue, residents and tourists. Representing one of the
City’s key industries, the design, construction and real estate
professions combined have both benefited from and significantly
contributed to the City’s prosperity.
In today’s economic climate, there is no shortage of work
for architects, engineers, contractors, skilled labor and
other building trades. In fact, since June of last year, New
York City has added 6,800 employees to its construction workforce.
Consequently, the year 2000 has the potential to be the highest
year for construction jobs in the City in more than 25 years.
Based on a review of capital budgets and private sector development
plans — highlighted in the charts and graphs that follow
— this surge in construction activity marks a continuing
trend. Construction spending and employment is expected to
remain at these levels at least through 2003.
Behind the Numbers-Problems Lurk
Workforce Stretching at the
Seams
For the first time in decades, the building industry’s available
workforce is straining to meet the intense demand for new
construction. Skilled workers in virtually all trades are
working unprecedented amounts of overtime. The shortage threatens
to intensify in the coming years as a large percentage of
the workforce nears retirement, and not enough young New Yorkers
are being trained to replace them. Additional workers and
training programs are needed to keep up with construction
activity projected through 2003 and beyond.
Infrastructure Critical
While public construction spending is indeed rising, the expected
level of increase is not keeping pace with private-sector
construction. The City’s unprecedented growth is adding jobs,
residents, businesses and tourists that require new infrastructure
to support their activities. New subways, schools, and housing,
as well as improved bridges and roadways, are needed. The
majority of public construction in the coming years is devoted
to maintaining the City’s infrastructure rather than expanding
it to meet the needs of a growing economy.
Office Space Crunch
Manhattan office vacancy rates have fallen from 16.0 percent
in 1995 to 5.5 percent in 2000. Though 13.6 million square
feet of office space is either planned or under construction,
most of this space is pre-leased and does not increase available
office space enough to accommodate the projected need for
40 million square feet by 2010. Further proof of the demand
for space is The New York Times recent report that the asking
price for Manhattan office space has increased by 28 percent
this year, 17 percent from May to July alone. To keep the
economy growing, and to retain corporations that have long
formed the bedrock of the City’s business community, development
of additional office space is vital.