The New York herald., 1920-01-18
BUILDING OUTLOOK
|. FOR 1920 HOPEFUL
Greater Activity Anticipated Thar
Ever Before in History of
Country Is Predicted.

with reference to the building situation
for the ensuing year s. w. Straus, of S.
w. Straus & Co.. said yesterday:-"Ac-
cording to present indications the coming
year will witness the greatest building
activity this country has ever known. Ali
fundamental conditions are right for
great building era. In the principal Amer
ican cities we shall see much construction
Of the larger types OF residential buildings
such as apartment houses and hotels as
the shortage OF servant labor and various
other conditions have created an unprece-
dented demand for living accommodations
in buildings of this description. Never be-
fore has there been such a demand for
structures of all kinds as exists at present.
During the last year the population OF all
our cities h1s Increased considerably.
which. together with tremendous business
expansion and the large building deficit
which has existed since 1917. has created
heavy building requirements throughout
the country.
Labor Not stabilized.
Though the ensuing year wiz witness
great activity in the building industry, this
will not be commensurate with the heavy
demand as the labor situation has not yet
become stabilized and product on tor some
time will necessarily be far below demand
Not only is there shortage OF labor d.
rectly engaged in construction work, but
the stocks of builIng materials are low.
During the last we've months the total
building and engineering operations
throughout the United States. based upon
contracts awarded, amounted to approxi-
mately s., 100000 Cl0. This increase was ap-
proximately s75e,C000c0 over 1915 The
actual gain in construction work in 1919.
however was not as extensive as these
. he t-er1
into consideration that the cost of labor
and materials are much higher than they
were one year ago
During 1863 the heavy demand for hous-
ing accommodate OF all kncs, increases
in costs of operations. taxes and other
expenses have brought about great ad-
Ivances in rents. typical illustration OF
this has been shown in New York city.
where the average advance during the
last year has been about twenty per cent
md where the Increases during the ensu-
ing year are expected to approximate the
same figure. Similar advances are en-
pected TO take pace throughout the coun-
try. These increases have not only oc-
Cured in the case of residential proper
ties and office buildings but there have
been similar gains in the prices paid for
industrial and manufacturing space In
the great industrial district surrounding
New York city manufacturing space which
foot is now commanding SOC. 10 60c.. with
indications of similar increase during
the coming year
Demand Exceeds supply.
! According to some of the leading manu-
facturers of building mater ais in the
| United States the demand for their prod
ucts at the present time is much greater
/ than the supply. The labor shortage has
been the main cause OF underproductlon,
according to these interests. In the steel
| industry, for example the manufacturers
hove not been producing much as in
normal years The output prior TO the
big steel strike about eighty-five per
cent OF normal. while at the present time
IL is about seventy or seventyfive per
cent. according TO statements made in we'll
! informed circles
! There are W dely divergent opinions as
| 20 the length of time which must elapse
before production in building materials
~e~cres the level OF derland. but the pre-
valing belief among leading manufact-
urers in this country seems TO be that
after labor conditions have become stabil-
'2ed such an equalization VIII occur within
the next few months.
( "In the manuta cture of most building
materials there are two groups of emnloycs
directly concerned in production--ski'led
ard unsk He'd Even at the present time
there is a tremendous shortage of IN
skilled or whoelbarrow labor. with tn
result that wages for this group have adj
vanced since 1914 more thnn $50 PER cent,
50 s~u1e reports show This advance 10
lunsklei labor has resulted in large in
creases to skilled lahor for the eason that
this cipss of wcrkmen has demarded a
ipronorticna'e increase to that paid un-
s',Ted 'ahcrcrs All these adv noes to labor
have played a most vital part in the In
crea sed cost OF rna a-erials.
Opinions Vary.
Some manufactur believe the cost of
labor in most building li7es has re ched
It's peak and for this reason there will be
ilitt'e or no further Increases In the costs
Of building materials. on the other hand.
many manufacturers state that the pres
ent upward trend in general costs Will
continue as long as labor is scarce and
business good
1T is interesting to note that during The
last year the public more than ever bc-
fore has participated in the financing OF
the nations building operations. We ar
coming to a thorough realization of the
fact that the general investing public
should be given an opportunity to share
in these operations. This Is opening up
for the benefit of the realty market a vast
reservoir Of capital now employed in other
industries and II Is giving the public an
opportunity 10 participate in the fruits OF
II.