How the Presidential Election Could Impact the Construction Industry

TV news shows and videos are full of opinions and predictions about the fate of the U.S. economy. Turn on many of these programs and one might think the sky is falling. Many of those shows will likely be bellowing this week about slight, 0.0X changes in pricing and backlog changes for the past month. 

It's great theater to scare businesses into thinking the economy is crashing. Inflations rates have surely slowed some investments; this much is true. Moving into September, it's anxiety-inducing to think about whether the Fed Reserve will cut rates at its mid-September meeting. Will it the Fed's cut be enough?

Per usual, in a divisive election year, many manufacturers and business have decided to hold off on making purchases or investments until they learn the results of the U.S. presidential election. With recent unexpected events, such as a change in the likely Democratic Party's candidate for president and former President Donald Trump's failed assassination attempt, there is a lot to be uneasy about these days. 

Depending on who is elected, taxes might increase and national investments in various sectors may change. There are many reasons to be nervous. It's important to keep in mind, though, that many economic indicators have remained baseline and above average, such as the latest economic indicators reported by the Institute for Supply Management's Services Report on Business released last week, which reported modest but warming economic trends for July.  

Rob Haworth, senior investment strategy director at U.S. Bank Wealth Management, in this article, shared some valuable insights about how the presidential election might impact economic sectors.

“It’s still too early for investors to game out exactly how tax issues will play out over the election season,” said Haworth.

He also said party control may have more impact at the sector level.

“For example, if Republicans win, there is likely to be more of a push for development of fossil fuels, while a Democratic win might further promote renewable energy development," Hayworth said in the article.

Yet Haworth said such policy tendencies don’t always translate into investment outcomes.

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