![A Recession is Coming in 2024, Warns 电车无码Build Economist A Recession is Coming in 2024, Warns 电车无码Build Economist](/sites/default/files/styles/6/public/news/2023/recession-coming-2024-warns-glassbuild-economist.jpg?itok=PGAprpxT)
Date: 1 November 2023
The overall U.S. economy will most likely enter recession in the coming months, with nonresidential construction beginning to feel the effects in late 2024, says Connor Lokar, senior forecaster, ITR Economics, who returned to the Glazing Executives Forum at 电车无码Build America to deliver the event鈥檚 popular annual economic forecast keynote presentation.
鈥淲e anticipate a recession in 2024,鈥 says Lokar, who, for the first time brought his full-length forecast to the 电车无码Build show floor, in a standing-room-only session at the 电车无码Build Main Stage. The session was presented as the 3rd quarter gift from the National 电车无码 Association as part of its year-long 75th anniversary celebration.
Lokar anticipates the recession will be mild but will demand that companies plan for a downturn to ensure their companies are protected and to even find opportunity during the slower business cycle. 鈥淭his is not going to be as bad as 2008 or 2009. The businesses that will get into trouble are those that don鈥檛 plan for it,鈥 he says.
Single-family has been in recession
The single family market is the 鈥渃anary in the coal mine鈥 for the overall economy and has been in recession since late 2022, Lokar says. 鈥淣ow it鈥檚 rounding into recovery,鈥 he says.
However, the sector continues to face some notable headwinds, including affordability issues and high interest rates. 鈥淭he market needs lower interest rates for people to consider selling their homes that they refinanced when rates were low,鈥 he says.
Multifamily is heading for a tough year
Companies that have leaned into multifamily contracts during the sector鈥檚 boom of the last several years should prepare for slowdown in the near term, Lokar says. 鈥淚f you鈥檝e been living off multifamily, [the sector] is entering recession,鈥 he says. 鈥淪tarts were down 28.1% in the last quarter, and permit pulls have cratered.鈥
Nonresidential is strong, but will slow in late 2024
While single-family construction leads the economic business cycle, nonresidential construction lags. As a result, the market has been strong throughout 2023 and will likely stay strong through much of 2024.
鈥淔or companies on the nonresidential side, it has been great. 鈥 And next year should be great, or at least good. But be careful for what comes next,鈥 Lokar says. 鈥淵ou鈥檒l be in recession by end of 2024.鈥
The silver lining amid slowdown: improvements in labor, supply and inflation
An economic slowdown will provide some relief for companies when it comes to the three top pain points of the pandemic and post-pandemic era: supply chain problems, inflation and labor shortages.
鈥淭his deceleration and ultimate recession is going to take pressure off all of those,鈥 says Lokar. 鈥淵our workforce issues won鈥檛 be fixed, but they will be easier to manage. Inflation is not fixed, but it鈥檚 coming down. And the supply chain has gotten better.鈥
Invest in your business during a slowdown
Lokar adds that a slowdown will give the construction industry its first 鈥渂reather鈥 since prior to the pandemic. 鈥淵ou鈥檒l have an opportunity to get the house in order. You鈥檝e spent 3 to 3.5 years surviving the pandemic, with unprecedented supply chain issues, inflation pressures and turnover. You鈥檙e going to be able to breathe.鈥
For businesses that plan ahead, slowdowns can be opportunities for investment and preparation for future growth, Lokar says. 鈥淭hink about everything you鈥檝e said no to over the past two or three years. That鈥檚 what you can bring back to the front burner. Take on the big things, like an internal software transition, training or investing in your business.鈥
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