March 2011: Industry Report

March 2011

By Sarah B. Atkins

Both residential and commercial construction activity have reached record or near-record lows. According to the U.S. Census Bureau, we have just lived through the lowest level of new housing starts since they began tracking this data in 1959. The trends are starting to change, but most experts agree there’s a long way to go before we attain real economic improvements in the construction industry. I am confident there will be an upturn, eventually. However, the future upturn will not be enough for the masonry industry to rebound robustly if brick is not the building envelope material of choice when that time does come.

I recently returned from World of Concrete/World of Masonry in Las Vegas. My company attended this event to gain exposure, to learn and educate, and to network and socialize. I returned both impressed and inspired by some of the people with whom I spoke. There are people and companies within our masonry sector that are getting creative, becoming more proactive, and increasing their energy and industry involvement. We must all take heed of their examples. Each of us needs to do this independently, collectively and cooperatively. We have to focus our energy now and do everything we can to ensure the brightest possible future for the masonry industry.

Is construction at its lowest point? The answer may come as no surprise to those of us in the construction business, but it is worth re-examining exactly where we are today. In 2009, new housing starts decreased by nearly 45 percent when compared to 2008. New home permits decreased by 70 percent between 2005 and 2009. Residential starts went from 1.5 million in 2003 to just 441,000 in 2009. The numbers for 2010 were close to those of 2009, with slight increases of 2.6 percent for permits and 6.1 percent for starts, which may indicate the tide has turned.

Not to be outdone, commercial construction also has been on the decline, but it is predicted to recover faster than residential construction during the next few years. New commercial starts had increased through 2007, and then were cut roughly in half by 2010. They are forecasted to return to the 2005 levels by 2014, but not before they hit their lowest levels in 50 years. A slight growth in commercial construction is expected in 2011, with offices, banks and retail stores showing the most improvement.

Unfortunately, the brick industry is forecasting a continued decline in both public and government buildings. In particular, masonry construction and the brick industry experienced a decline from 9.5 million shipments of brick in 2005 to just 3.5 million shipments of brick in 2009. The Brick Industry Association (BIA) points out that its impact is still an overall positive one on the U.S. economy. Even with the decline, masonry still contributes more than $5 billion a year to the U.S. economy, which translates into more than 120,000 jobs. Every brick produced in the United States equals $2 contributed by the industry to the economy. The number of bricks per building start is the highest it has ever been, indicating that commercial construction is taking place, and the buildings being constructed are larger.

This data may not be unexpected as it is well known that construction activity has been weak. With all of this negative information about the construction industry, can there be a positive future?

Lessons learned How do we possibly find optimism despite this forecast full of doom and gloom? I found many examples during World of Concrete/World of Masonry. I was impressed by the dedication and direction of several of the masonry firms, brick companies and other industry professionals.

The owners of Milam Masonry & Contracting LLC of Benton, Mo., are clearly doing what it takes to survive and prepare for the future. They have recently grown from eight to 20 employees, despite the difficult climate. They credit not only hard work, but also flexibility. They have traveled to areas where work is available and picked up business that others left behind. Additionally, they are committed to developing relationships with architects who work with masonry designs in their market area. They discuss moisture management as well as available masonry products and practices. By taking these steps, they are not only promoting their company’s reputation, but also adding value to the industry by encouraging the use of masonry as the building material of choice.

I am pleased to report that a considerable percentage of my conversations were with masons in their 20s and 30s. Matias Sposato of Sposato Masonry in Watchung, N.J., is one example. He embraced technology as he toured the booths to learn about the products on display. Sposato began his visit to each booth with a digital video of the products displayed. He then asked questions and continued to record the answers and explanations provided by the booth staff. Curiosity caused me to ask if he was going to use the recordings to share with his staff, who weren’t able to attend the convention.

Sposato replied, “Not exactly. I am going to show these to my prospective customers, so that they will be confident I am keeping up with masonry developments and products. They will also then know what accessories are available to them, and why they should consider using them in their homes.” This attitude and his proactive practice will, no doubt, serve this young man well as he travels down his career path. We may all benefit by the spread of masonry techniques and knowledge to homeowners, which in turn will help the overall reputation of the masonry industry.

We need to further our support of today’s youthful masons who will be the future of masonry. Promotion and sponsorship of events like the MCAA’s Masonry Skills Challenge, held during the MCAA Convention at World of Concrete/World of Masonry, that excite and energize our future masons will only serve our industry. The MCAA’s fundraising event held during the Convention at the Hofbrauhaus raised money for their South of 40 Committee, a group whose mission is to “provide members the opportunity to learn, to become more involved, and to introduce a more youthful voice into the masonry industry.” We should not only support these and similar efforts, but each of us should consider creating this type of synergy in our communities. Some options could include guest speaking at bricklaying and masonry classes at community and technical colleges. Other options might be hosting a field trip or sponsoring a regional version of the Masonry Skills Challenge. These types of activities do require some resources, but can go a long way to secure our industry’s future.

Masonry suppliers also have much to offer. As an example, Potomoc Valley Brick, headquartered in Rockville, Md., offers free monthly breakfasts that provide education credits and assist designers and builders in the proper design and use of masonry products. Even more notable is their development of the BrickStainable Design Competition, which is now in its second year. This competition seeks “to attract and promote new ideas in the manufacturing of, the application of, or the physical arrangement of clay masonry units that promote energy efficiency and environmentally sustainable building design.” This has quickly become a premier event that received entries from more than 60 countries. The synergies created by this competition are almost unbelievable and have earned recognition from the USGBC-MD chapter. Anyone seeking inspiration will likely find it by learning more about these efforts at www.brickstainable.com. Not every individual or company has the resources to make such a large contribution to the masonry industry, but with imagination and determination, there are surely smaller-scaled projects that can be developed using similar concepts.

These are just some of the examples that inspired me during the convention. I have witnessed the creative juices that are flowing. I encourage each of us to capture that energy. Be it on a large or small scale, I urge you to invest in yourself and contribute to the industry.

A call to action We are all aware this is a critical time for everyone connected to the masonry industry. Every business owner knows that now is the time to look internally for ways to can make their businesses run more efficiently and effectively. However, that is not going to be enough. As a collective, we also need to make certain masonry excels as the exterior of choice as the construction industry turns around.

Take the lead from those innovators I met at the convention, and begin to imagine what more you can do to help shape the industry’s future. Find ways to promote masonry in your community, region and beyond. Seek out and become active in local association chapters (e.g., The Masonry Council, MCAA, International Masonry Institute). There is strength in numbers. Team up with other businesses in the industry – maybe even your competition. Embrace technology and its ability to show people how masonry construction is sustainable, desirable, efficient and durable. We each have to accomplish what we can independently, so that collectively our efforts will provide the masonry industry with a bright future for generations to follow.

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