Do not Underestimate the Power of Local Business
The real power in the United States economy is small business. In fact, contractors feed local economies each day and most of them are small businesses. Many underestimate the power of local business. They fail to see how our communities would collapse if we do not sustain a healthy small business community.
Take a moment to think about it. Or better yet, grab a coffee and sit by a main road in any community. Write down what type of vehicles you see during the hours of 6am and 12 noon. You will find that many of the vehicles are work vehicles. Many are contractors and technicians. They stop at local stores, gas stations, supply centers, and more. They work closely with your neighbors. They accomplish tasks and order parts that are shipped. This feeds trucking and logistics.
Types of Contractors
Just a few: roofing contractors, flooring, siding, kitchen cabinets, fencing, railings, chimney sweepers, pressure washing, landscaping, painters, HVAC, pool, irrigation, plumbing, bathroom, property rehabilitation specialists, carpentry, and many others.
The men and women that work within these trades pump money into the local economy, and also help the nation (and global) economy. In fact, places such as Lowes benefit from the efforts of the “small shops”. People in the real estate industry also benefit from the efforts of contractors through property value increases after repair. They also satisfy town government to accomplish permit submissions and occupancy permits.
Yes, contractors are true workhorses of the local economy.
Areas Where Contractors Feed the Economic
Small shop contractors pump valuable dollars into the local economy each day. Most even live in the local economy and pay taxes like the rest of us. Some of the areas that they impact are as follows:
- Transportation (travel, fuel, tolls, supplies, delivery, etc.)
- Food Service (meals)
- Tools (project-specific tools)
- Local Supply Shops (purchasing parts, supplies)
- Real Estate (maintenance, home improvement)
- Waste Management (recycling, waste removal, salvage)
- Resident (savings options through competition)
- Government (increasing property value = tax revenue; tax on supplies)
These are only a few of the ways that local contractors help the local economy.
National Impact of Contractors
- U.S. gross domestic product (GDP)—the value of all goods and services produced in the country—totaled $23.0 trillion in 2021; construction contributed $959 billion (4.2%).
- There were 872,000 construction establishments in the U.S. in 2021.
Construction Spending:
- Nonresidential spending in the U.S. totaled $823 billion in 2021 ($486 billion private, $338 billion public).
- Residential construction spending in the U.S. totaled $803 billion ($423 billion single-family, $101 billion multifamily, $269 billion improvements, $9 billion public).
- Private nonresidential spending in California totaled $23 bllion in 2021. State and local spending totaled $44 billion. (Totals are not available for residential, railroad, power, communication, or federal construction spending).
Construction Employment (Seasonally Adjusted):
- Construction (residential + nonresidential) employed 7.7 million workers in August 2022, an increase of 311,000 (4.2%) from August 2021, and an increase of 1.1% from February 2020, the peak pre-pandemic month.
- Contractors are having trouble filling positions, impeding the industry’s recovery.