In a healthy economy, US residential contractors build 1.5M single family homes a year. The last two years have been the worst since 1959. In 2009, homebuilders broke ground on 554,000 homes and in 2010 they improved slightly to 587,600 homes. Not many industries face volumes dropping to about 1/3 of previous levels.

The unemployment level in construction dropped to about 21% in December, which is surprisingly low compared to the volume drop described above. Of course, the US construction business is more than single family housing. Apartment construction continues to go well as does the public work sectors.

Unfortunately, the construction market for 2011 and 2012 looks bleak. The spending and lending problem hasn’t gotten resolved. Consumers hesitate to spend due to uncertainty and banks to lend for the same reason. The tight state budgets  will also dampen public works for the foreseeable future. Of course, the poor job by banks and the courts to resolve foreclosed properties and get them back into the market further prolongs the pain.

On the bright side, no one really knows what the economy will do next. Remember the words of the old contractor that I have in listed in ConstructionKnowledge.net, “When things are really, really bad, don’t get too excited…’cause they’ll get good again. And when things are really, really good… don’t get too excited….’cause they’ll get bad again” .