Federal debt-limit actions will affect construction industryCongressional leaders and the White House have not yet made a deal regarding raising the $14.3 trillion federal debt ceiling, and construction economists say the potential consequences severely could affect the construction industry, according to ENR.com.
If a deal is not reached, interest rates reportedly would increase across the board, and credit would be much tighter than it was in 2008, which would halt new projects.
However, if congressional leaders and the White House strike a deal that is accompanied by federal spending cuts, it also significantly would affect the industry, hitting infrastructure programs and hurting design, construction materials and equipment companies that depend on federal work.
Robert Murray, vice president of economic affairs for McGraw-Hill Construction, a division of The McGraw-Hill Cos., New York, says failure of a deal would cause interest rates to rise, thereby delaying any rebound in single-family housing construction and the commercial building sector, as well as worsening declines for institutional construction and public works.
Date : 7/25/2011