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McLean County – Building Permits 2023

Construction Word Cloud

Building permits serve as a critical indicator of economic health, reflecting trends in construction, real estate, and broader economic activity. Governments, investors, businesses, and policymakers closely monitor building permit statistics because they provide valuable insights into future economic growth, employment, investment patterns, and urban development. Understanding the economic impact of tracking these permits is essential for informed decision-making at both macro and microeconomic levels.

  1. Leading Indicator of Economic Growth Building permits are a leading economic indicator, meaning they signal future economic activity before it materializes. When permit approvals rise, it suggests that developers and homeowners are planning new construction projects, which will lead to increased spending on labor, materials, and services. This activity stimulates economic growth by:

    • Boosting GDP: Construction contributes significantly to Gross Domestic Product (GDP). Increased permits indicate upcoming investments in residential, commercial, and infrastructure projects, driving economic expansion.
    • Encouraging Multiplier Effects: Construction generates demand for related industries, including manufacturing (steel, cement, lumber), transportation, and professional services (architecture, engineering). Each dollar spent in construction circulates through the economy, creating additional economic value.


  2. Employment and Labor Market Effects The construction sector is a major employer, and building permit trends directly influence job creation. Monitoring permits helps predict labor demand in:

    • Direct Construction Jobs (e.g., carpenters, electricians, plumbers)
    • Indirect Jobs (e.g., suppliers, equipment manufacturers, logistics)
    • Induced Jobs (e.g., retail, food services, real estate agents)


    A decline in permits may signal upcoming layoffs, while an increase suggests hiring surges. Policymakers use this data to implement workforce training programs or adjust fiscal policies to support employment stability.

  3. Real Estate Market Stability Building permits provide insights into housing supply and affordability. Key impacts include:

    • Housing Supply & Prices: A surge in residential permits can alleviate housing shortages, stabilizing or reducing home prices. Conversely, a permit slowdown may indicate future price increases due to constrained supply.
    • Commercial & Industrial Development: Permit trends for offices, warehouses, and retail spaces reflect business confidence. Rising commercial permits suggest economic optimism, while declines may signal downturns.


  4. Government Revenue and Public Planning Local governments rely on building permits for:

    • Tax Revenue: Permit fees, property taxes, and sales taxes from construction activities fund public services (schools, roads, utilities).
    • Infrastructure Planning: Permit data helps municipalities plan for transportation, utilities, and zoning adjustments to accommodate growth.
    • Regulatory Adjustments: Monitoring permits allows governments to identify bottlenecks (e.g., excessive delays in approvals) that may hinder economic development.


  5. Investment and Financial Market Implications Investors and financial institutions analyze permit data to:

    • Guide Real Estate Investments: Developers and REITs (Real Estate Investment Trusts) use permit trends to identify high-growth regions.
    • Assess Credit Risk: Banks evaluate loan applications based on construction demand; rising permits may indicate lower risk in mortgage and commercial lending.
    • Predict Commodity Demand: Building material suppliers and futures traders monitor permits to anticipate demand for lumber, steel, and other inputs.


  6. Economic Policy and Risk Management Policymakers use permit statistics to:

    • Adjust Monetary Policy: Central banks may consider construction trends when setting interest rates to control inflation or stimulate growth.
    • Mitigate Bubbles & Crashes: Rapid increases in permits may signal overheating (e.g., housing bubbles), while prolonged declines could foreshadow recessions.


Conclusion

Monitoring building permit statistics is vital for anticipating economic trends, guiding investments, and shaping policy. These permits influence GDP growth, employment, real estate dynamics, government revenue, and financial markets. By analyzing permit data, stakeholders can make proactive decisions that enhance economic stability, promote sustainable development, and mitigate risks. Ignoring these indicators could lead to misallocated resources, housing crises, or missed growth opportunities-underscoring the importance of vigilant tracking in economic planning.

 
Quarter
      Total Units
      Single-Family Units
      All Multi-Family Units
2-unit
3 / 4-unit
5+ unit
     
1997 Q1 12  bar 12  bar 0  bar 000
Q2 88  bar 84  bar 4  bar 400
Q3 83  bar 79  bar 4  bar 400
Q4 89  bar 78  bar 11  bar 470
 
1998 Q1 26  bar 22  bar 4  bar 040
Q2 192  bar 164  bar 28  bar 6022
Q3 119  bar 95  bar 24  bar 0168
Q4 394  bar 72  bar 322  bar 20320
 
1999 Q1 11  bar 11  bar 0  bar 000
Q2 92  bar 92  bar 0  bar 000
Q3 99  bar 91  bar 8  bar 080
Q4 61  bar 59  bar 2  bar 200
 
2000 Q1 61  bar 43  bar 18  bar 0018
Q2 95  bar 92  bar 3  bar 030
Q3 65  bar 33  bar 32  bar 0032
Q4 90  bar 46  bar 44  bar 0044
 
2001 Q1 60  bar 60  bar 0  bar 000
Q2 106  bar 90  bar 16  bar 0016
Q3 148  bar 84  bar 64  bar 0064
Q4 201  bar 73  bar 128  bar 20126
 
2002 Q1 40  bar 40  bar 0  bar 000
Q2 140  bar 103  bar 37  bar 0037
Q3 119  bar 86  bar 33  bar 0330
Q4 563  bar 86  bar 477  bar 07470
 
2003 Q1 150  bar 38  bar 112  bar 00112
Q2 165  bar 118  bar 47  bar 0047
Q3 188  bar 96  bar 92  bar 0092
Q4 113  bar 94  bar 19  bar 289
 
2004 Q1 47  bar 47  bar 0  bar 000
Q2 88  bar 88  bar 0  bar 000
Q3 108  bar 108  bar 0  bar 000
Q4 143  bar 58  bar 85  bar 2083
 
2005 Q1 19  bar 19  bar 0  bar 000
Q2 87  bar 75  bar 12  bar 0012
Q3 60  bar 49  bar 11  bar 0011
Q4 74  bar 61  bar 13  bar 0013
 
2006 Q1 49  bar 39  bar 10  bar 0010
Q2 52  bar 46  bar 6  bar 006
Q3 50  bar 37  bar 13  bar 2011
Q4 76  bar 67  bar 9  bar 009
 
2007 Q1 27  bar 16  bar 11  bar 0011
Q2 63  bar 37  bar 26  bar 0026
Q3 41  bar 32  bar 9  bar 009
Q4 92  bar 30  bar 62  bar 0062
 
2008 Q1 29  bar 15  bar 14  bar 0014
Q2 34  bar 27  bar 7  bar 007
Q3 23  bar 15  bar 8  bar 008
Q4 21  bar 15  bar 6  bar 006
 
2009 Q1 28  bar 4  bar 24  bar 0024
Q2 51  bar 27  bar 24  bar 0024
Q3 21  bar 21  bar 0  bar 000
Q4 34  bar 34  bar 0  bar 000
 
2010 Q1 19  bar 19  bar 0  bar 000
Q2 38  bar 38  bar 0  bar 000
Q3 28  bar 21  bar 7  bar 007
Q4 41  bar 17  bar 24  bar 0321
 
2011 Q1 96  bar 7  bar 89  bar 0089
Q2 18  bar 18  bar 0  bar 000
Q3 34  bar 18  bar 16  bar 0016
Q4 62  bar 18  bar 44  bar 0044
 
2012 Q1 14  bar 14  bar 0  bar 000
Q2 24  bar 24  bar 0  bar 000
Q3 18  bar 18  bar 0  bar 000
Q4 43  bar 27  bar 16  bar 0016
 
2013 Q1 9  bar 9  bar 0  bar 000
Q2 51  bar 32  bar 19  bar 0019
Q3 43  bar 29  bar 14  bar 0014
Q4 158  bar 33  bar 125  bar 00125
 
2014 Q1 6  bar 6  bar 0  bar 000
Q2 35  bar 35  bar 0  bar 000
Q3 20  bar 20  bar 0  bar 000
Q4 12  bar 12  bar 0  bar 000
 
2015 Q1 6  bar 6  bar 0  bar 000
Q2 22  bar 18  bar 4  bar 400
Q3 14  bar 14  bar 0  bar 000
Q4 19  bar 19  bar 0  bar 000
 
2016 Q1 4  bar 4  bar 0  bar 000
Q2 15  bar 15  bar 0  bar 000
Q3 11  bar 11  bar 0  bar 000
Q4 50  bar 18  bar 32  bar 0032
 
2017 Q1 8  bar 8  bar 0  bar 000
Q2 14  bar 14  bar 0  bar 000
Q3 8  bar 8  bar 0  bar 000
Q4 11  bar 7  bar 4  bar 400
 
2018 Q1 10  bar 10  bar 0  bar 000
Q2 13  bar 13  bar 0  bar 000
Q3 50  bar 2  bar 48  bar 0048
Q4 6  bar 2  bar 4  bar 040
 
2019 Q1 31  bar 4  bar 27  bar 0027
Q2 6  bar 6  bar 0  bar 000
Q3 19  bar 3  bar 16  bar 0016
Q4 18  bar 6  bar 12  bar 0012
 
2020 Q1 4  bar 4  bar 0  bar 000
Q2 68  bar 7  bar 61  bar 0061
Q3 13  bar 13  bar 0  bar 000
Q4 50  bar 30  bar 20  bar 0020
 
2021 Q1 20  bar 6  bar 14  bar 1400
Q2 40  bar 10  bar 30  bar 0030
Q3 18  bar 18  bar 0  bar 000
Q4 21  bar 21  bar 0  bar 000
 
2022 Q1 11  bar 11  bar 0  bar 000
Q2 20  bar 20  bar 0  bar 000
Q3 14  bar 14  bar 0  bar 000
Q4 78  bar 12  bar 66  bar 2064
 
2023 Q1 3  bar 3  bar 0  bar 000
Q2 18  bar 18  bar 0  bar 000
Q3 20  bar 18  bar 2  bar 200
Q4 24  bar 22  bar 2  bar 200
 


Sources: STI: PopStats and STI: Colossus