Carolinas AGC Construction Barometer(TM) Moves Up 5.9% Seasonal Factors Power the Increase

Oct 23, 2002, 01:00 ET from Carolinas AGC

    CHARLOTTE, N.C., Oct. 23 /PRNewswire/ -- The Carolinas AGC Construction
 Barometer(TM) posted a 5.9% increase during the second quarter of 2002,
 rebounding to 2001 year-end levels after a dip in first quarter 2002.  The
 increase came primarily on a major improvement in the quantitative Business
 and Economic Trends category.  This indicator, down 21.5% in first quarter
 2002, increased 36.9% in second quarter 2002.  It's rare for any individual
 Barometer value to whipsaw so dramatically from quarter-to-quarter.  A large
 increase in North Carolina highway letting as well as the seasonal spring
 surge in construction volume drove the increase in this component.
     "The lowest interest rates in 40 years and seasonal increases in
 construction activity combined for the improvement in the Barometer, but these
 numbers are masking the underlying patterns of slow economic growth,
 unemployment and uncertainty," says Tony Plath, UNCC associate professor of
 finance and developer of the Carolinas AGC Barometer.  "Any sort of
 substantive improvement in business conditions in the regional commercial
 construction industry is going to take some time -- at least well into 2003."
     Employment and Labor Trends, such as unemployment and wage rates, remained
 relatively stable, as did financing indicators like interest rates.
 Contractor sentiment remains somewhat bearish in terms of employment and
 labor, as well as business and economic trends.
     The improvement was seen geographically, quantitatively and qualitatively.
 South Carolina, which dipped 8.9% in first quarter 2002, experienced an 8.1%
 rise this quarter.  Down 3.8% in first quarter 2002, North Carolina rebounded
 4.9% in second quarter 2002.  All five economic regions in the two-state area
 showed increases in regional indices.  Rural regions have bounced back more
 quickly than the more urban regions of the two states.  The largest percentage
 increase was seen in Low Country, SC (up 15.9%), followed by Eastern NC (up
     Additionally, the Barometer showed increases in the Qualitative Series (up
 0.9%) as well as the Quantitative Series (up 11.0%).
     State-By-State Overview
     The North Carolina Barometer rose 4.9% from first quarter to second
 quarter 2002, slightly above the 2001 year-end figure.  Seasonal surges in
 highway letting and construction volume were responsible for much of the
     The rural Eastern NC region led the way with a 12.4% increase, followed by
 Western NC with a 10.7% positive move.  The more urbanized Heartland NC region
 lagged behind with a 2.0% increase.  This was due in large part to a 23.1%
 decrease in the Heartland's quantitative Employment and Labor Trends.
     South Carolina's Barometer rose 8.1% in second quarter 2002, regaining
 most of the ground it lost in first quarter 2002.  Highway letting actually
 slipped a bit in South Carolina, but the spring seasonal spike in construction
 volume increased appreciably.
     As in North Carolina, the more rural region of South Carolina experienced
 the most significant positive move.  Low Country SC's index was up 15.9% on
 major increases in both the Employment and Labor and Business and Economic
 trends quantitative components, as well as increases in the qualitative
 Business and Economic and Financing components.  Upstate SC made a more modest
 5.1% move to the upside.
     As the largest AGC chapter in the US with 3,300 member firms, Carolinas
 AGC builds its members' businesses through workforce development, business
 development, profit management, and a self-insured workers' compensation
 trust.  More than 75% of commercial/industrial work (buildings, highways,
 utility facilities) in the Carolinas is performed or supported by CAGC
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SOURCE Carolinas AGC