The construction market may take a slight dip in 2008 due to a downturn in nonresidential construction, according to FMI.

The management consultants and investment bankers to the building and construction industries recently announced its outlook for the second quarter of 2008.

It indicates that construction levels for 2008 remain much the same, but the outlook for 2009 has been revised downward because a drop in nonresidential construction usually comes after a slowdown in the general economy.

Recently released economic indicators are somewhat mixed. Housing, credit tightening, consumer spending and inflation continue to hinder the U.S. economy. While the general economy is expected to begin to stabilize somewhat, nonresidential construction is expected to falter late in 2008 and into 2009.

“The Fed (Federal Reserve Board) continues cutting rates to stimulate the economy, but inflation is becoming a threat and a pause is likely,” said Heather Jones, construction economist for FMI’s Research Services.

Total construction will be down 4 percent in 2008 and 1 percent in 2009, based upon large decreases in residential construction that will not be offset by gains in nonresidential and nonbuilding construction, FMI predicted. The decline in 2009 will be driven by a decrease in nonresidential construction for the first time since 2003.

Historical information in FMI’s forecast is based on building permits and construction data provided by the U.S. Commerce Department.