Trenchless Technology

JAN 2019

Trenchless Technology is the premier communications vehicle for the trenchless industry. Through our multiple platforms, readers receive insights into the trenchless industry, as well as keep connected to the latest news, products and projects.

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Page 39 of 67

40 T R E N C H L E S S T EC H N O LO GY JA N UA RY 2019 T H E C O N S T R U C T I O N M A R K E T in the United States is booming amidst the second longest period of sustained economic expansion since 1964. Despite fears of an impend- ing slowdown, FMI Research projects that construction put-in-place will in- crease year-over-year by 6 percent in 2018 (up from 5 percent in 2017). The industry continues to be bol - stered by strong growth in the resi- dential construction segment—driven by near-full employment , wage im- provement , and housing supply short- age. While the residential segment 's growth rate is beginning to deceler- ate, FMI speculates that the influx of first- time, millennial homebuyers will continue to push demand. Infrastruc- ture construction spend—particu- larly related to transportation (e.g ., airport , mass transit , railroad, water ports) and nonbuilding structure con- struction (e.g ., power, highway, water, sewer)—has also contributed to strong 2018 performance. Significant investment across the power, water, and sewer segments is necessitated by the demands of a growing population— the Census Bu- reau projects that the population will reach ~350 million by 2030. Positive macroeconomic trends also reinforce the need for such investment to sup - port the corresponding growth in commercial and industrial sectors. The demand for utility services ( i .e., electric, natural gas, and water) has outpaced current capacity and the aging infrastructure already in place has become increasingly unreliable. Going forward, significant oppor- tunity exists for industry operators specializing in underground pipeline construction services to replace exist- ing infrastructure amidst heightened regulatory scrutiny. During 2017, in- vestor-owned utilities invested ~$50 billion in their transmission and dis- tribution networks. These utilities are in the early stages of multi-decade spending initiatives and are becom- ing increasingly reliant on third-party construction service providers due to aging utility workforces. The communication construction segment (up 5 percent year-over-year) is experiencing similar tailwinds. Deloitte estimates that $130 to $150 billion of fiber infrastructure invest- ment will be needed over the next five to seven years to "support broadband competition, rural coverage, and wire- less densification." The emergence of 5G wireless technologies marks the 2 0 1 9 F M I C O N S T R U C T I O N O U T L O O K By Nick Illuminati and Dan Shumate

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