By SHAWN PIATEK
The housing boom of years past has gone bust nationally. As a result, those in the construction trade say they are are taking a major hit to their wallets.
The U.S. Department of Commerce on Monday reported that construction spending reached a four-year low in January, dropping 3.3 percent during the month. That drop left the seasonally adjusted construction spending rate last month at $986.2 billion, the lowest since June 2004.
Locally, the impact has been mixed.
Several contractors and architects reached on Monday by The Tribune-Democrat said that while they are leary of their future prospects, they currently have enough work scheduled to keep them busy for the rest of the year.
“It’s dried up a little bit,” said Doug Rush, president of Major Builders, 514 Menoher Blvd., in Johnstown’s Kernville neighborhood.
“There are people who have put things on hold. But basically, for us, we’re busy,” he said. “I can see us working through the next year without much of a slowdown.”
But that slowdown could be coming locally if the workload of area architects is any indication.
Ed Pawlowski of Pawlowski/Haman Architects, 430 Main St., downtown Johnstown, said his business was off by about 20 to 25 percent during the fourth quarter of last year and continued to be slow at the beginning of this year. He said in just the past week or so business has begun to pick up.
“We’ve been really hurting because there was nothing coming out,” Pawlowski said. “But now we’re seeing it starting to come back. We think we have enough work right now to take care of us for a few months to come.”
Fred Turnbull, project architect at Frank Dachille Architects, 911 Menoher Blvd., Southmont, said his firm has been able to remain pretty busy. But Dachille is looking for ways to diversify its firm in anticipation of a slowdown because it’s not certain how long it will receive a steady stream of work.
“The projects are getting a little more sparse,” said Turnbull, who has been with the firm since 1979. “We are still busy, but two weeks from now it’s hard to tell where we might be.”
Some in the industry, such as Johnstown Construction Services and Mihalko’s General Contracting, both at 695 Solomon Run Road, Richland Township, are thriving in spite of the recession.
Jim Vasilko of Johnstown Construction Services said his company is poised to have one of its best years. He said the company is anticipating revenues will increase by 50 percent this year.
“The projects are out there,” Vasilko said.
“You just have to dig a little bit deeper.
“The thing that is really hurting the construction business, and you can really see it in the residential side, is that people are doing work just to do work. They’re not figuring overhead costs and profits into jobs, and that is going to catch up with them.”
Lou Mihalko of Mihalko General Contracting said his business is coming off its best three-month run since it was founded in the early 1980s. Mihalko said his company’s success is largely linked to its specialties – home repair and remodeling and insurance restoration work.
The harsh winter has provided an upturn for Mihalko’s insurance restoration business. Mihalko said that his company has responded to provide cleanup and repair services due to flooding, wind damage, fires and bursting pipes – all related to the difficult winter conditions.
Additionally, Mihalko said his company has seen a stark increase in the number of homeowners choosing to spend money to upgrade their dwellings.
“I think people are tired of putting money in the stock market and seeing it go down the tubes,” Mihalko said. “I think they see investing in their house as something they can enjoy immediately as well as being an investment that will pay off in the long term.”
Ultimately, Rush doesn’t believe the region will be hit as hard as other regions in the state and country. He said because the area never went though the housing boom, it doesn’t have far to fall during the bust.
“There’s no big secret to how you get work,” Rush said. “You just have to stay on top of what’s going on and go after it.”
