The top economist for the Associated General Contractors of America says home construction isn’t likely to pick up anytime soon in Iowa. But, Ken Simonson says the outlook isn’t all bad for builders in the months ahead. Simonson says he expects the housing market to be sluggish for most of the year and maybe into next year.

Simonson says the good news is it doesn’t look like the slowdown in home construction will spill over into other construction areas and there are several categories that look strong. Simonson says contraction in the energy industry looks promising.

Simonson says that may take the form of ethanol plants and related storage and distribution facilities. He says wind farm construction and biodiesel plants also have potential for construction work. Simonson says one concern is a continuing increase in the cost of construction materials brought on by the demand from other countries.

Simonson says those increasing costs could pose a problem for some agencies with construction plans. Simonson says school districts and the state highway program will have trouble with the rapidly increasing costs. He says in general there is such a need to rebuild and modernize hospitals, build schools, and plenty of commercial construction to keep the industry busy. Simonson says those in the construction industry can be optimistic about the year ahead.

Simonson says they can expect a good year in terms of new projects, but be on the lookout for new construction costs and try to educate owners that the calm rate of inflation is not what they should expect in terms of construction costs. Simonson was in Des Moines Thursday to talk with members of the construction industry.