Construction industry continues to struggle, along with consumer ...

Construction spending across the nation declined in February, and locally some residential builders are doing better than those in the commercial arena, but one thing seems certain?consumer confidence has been shaken, and it?s not easy to turn that around.

?Homebuyers have always, [even] through the recession, had access to borrowing,? Jay Bell, owner of Bell Development, said. ?There has been a psychological barrier to overcome. People can get financing. What they can?t get easily is the confidence to buy a house.?

According to Bloomberg, construction spending decreased by 1.1 percent in February. That decline followed a 0.8 percent decrease in January.

Bell said that from his point of view, residential construction is stable.

?We?re not seeing it expand at a fast rate or contract at a fast rate,? he said.

But leaders on the commercial side said?although the situation has improved slightly?that?s relative to zero business last year.

?We basically didn?t get any commercial work last year,? Marvin Cornelison, president of Raines Brothers, said.??It was next to nothing for the entire year. We do both residential and commercial. Our residential kept us going last year.?

The residential work Raines Brothers did was for people who have the money to invest and didn?t have to borrow, he also said.

Now, Cornelison is seeing a small improvement in commercial projects, but the struggling industry has prompted his competition to lower prices to unsustainable levels, he said.

?The capacity of the industry in Chattanooga was way beyond the work,? he said. ?At times, over the last three years, a lot of contractors have been taking work that [I suspect in some cases] causes them to lose money.?

Cornelison said he didn?t think it was smart for his company to take that tactic. During shorter times of instability, ?almost everybody? will use that strategy to some extent, he said.

But, in this long-term, unstable economy, Cornelison thought it better to ?just downsize and try to hang out.?

Looking to the future, it depends on who you ask, but Cornelison said some in his business don?t think things will fully bounce back until 2015.

Until then, it?s ?survival mode,? Cornelison said.

But, he and Bell agree that the situation in Chattanooga is much better than in other areas, such as Georgia and Florida.

?I would say, as Chattanoogans, it is significant to realize that we are some of the luckiest people in the country,? Bell said. ?A lot of things in this county have kept us working in this recession.?

Updated @ 8:46 a.m. on 04/05/12 for clarity.

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