Contractors: Contribution to the U.S. GDP
Construction’s value-added contribution to U.S. GDP is immense
Even with its ups and downs, the construction industry will always play a dominant role in sustaining U.S. economic growth. Buildings will always be required to support our productivity, and homes will be needed to accommodate the fast-growing U.S. population, which is expected to reach an estimated 439 million in 2050, a 44 percent increase from 2008, states the U.S. Census Bureau.
Construction is one of the largest individual contributors to GDP. According to the Associated General Contractors of America (AGC), private nonresidential investment grew at a faster pace than GDP for 11 straight quarters through mid-2008. The construction industry’s value-added contribution totaled more than $562 billion in 2007, as reported by the U.S. Bureau of Economic Analysis (BEA). This is a decrease of approximately $68 billion from the value-added amount of $630 billion reported for 2006. In 2007, the construction industry was responsible for 4.1 percent of GDP, down from a 4.8 percent contribution in 2006.
Historically, the BEA reports that construction’s value-added contribution to GDP increased at a compounded annual rate of 2.6 percent from 2002 to 2007. Over this six-year period, the industry’s portion of GDP reached a high of $630.0 billion in 2006. From 2002 to 2007, construction’s contribution to GDP averaged 4.6 percent.