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U.S. Construction to be flat in 2011, but up from 2009 and 2010

The idea that U.S. Construction spending will be flat in 2011 doesn't exactly sound like great news, but when you consider the kind of years 2009 and 2010 were, it is at least a step in the right direction.

According to the Fourth Quarter U.S. Construction Briefing by IHS Global Insight's Construction Service, construction will be flat in 2011, pushed higher by positive second half gains in the residential and commercial sectors as they begin to move up from the historic lows of the recent past.

People we talk to in the metal construction industry, meanwhile, are telling us they're starting to turn a corner.

Here are some select key findings from the IHS fourth quarter forecast:

Residential. In 2010, gains in the single-family and improvement sectors will offset the continued weakness in the multi-family segment, resulting in overall growth of 1.7 percent. Growth in residential construction will fall to 0.4 percent in 2011 before becoming steadier in 2012 as the housing market corrects itself.

Commercial. After seeing losses of more than 50 percent from 2008 levels, the commercial construction sector will reach bottom in 2010 and will see significant improvement in 2011, with growth of 3.1 percent in the sector.

Infrastructure. Stimulus spending on highways and streets will be outweighed by a drop-off in power construction spending due to overcapacity in the power sector. This will result in a decline of 3.5 percent in 2010; these declines will continue into 2011.

The IHS Global Insight Construction Service provides analysis, forecasts, and data on the worldwide construction industry for building materials manufacturers, construction equipment, engineering and services companies, real estate investment and financial services firms, home improvement retailers and architectural firms, and the U.S. and other governments. For the Fourth Quarter U.S. Construction Briefing Executive Summary, go to www.ihsglobalinsight.com/constructionoutlook.

IHS Global Insight is part of IHS (NYSE: IHS).

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