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During 2010 the worldwide construction industry continued to be negatively affected by the economic crisis of 2008. Of course, some areas were less affected than others, namely those areas that avoided the excesses that contributed to the crisis. The construction and real estate industries have always been cyclic, and it could be argued that downturns are good for them. The downturns help rein in the excesses that occur during a boom period.

The normal cycle is usually a few years, but from 1993 to 2008, there was only one slight downturn around 2001. This exceptionally long boom period made the correction that much more severe because it created very unrealistic expectations about the marketplace.

The false beliefs that real estate goes only up and if we build it, they will come fueled a frenzy that was clearly unsustainable. The result has been the worst recession in the construction industry since the Great Depression. The industry downturn is unique because it was worldwide. Normally construction industry downturns occur in some regions, while other regions remain healthy. Virtually every region around the globe was affected by the crisis, and while some regions didn't experience negative growth, they did see their growth stopped.

For example, the Census Bureau reported on November 1, 2010, that U.S. construction spending totaled $802 billion in September at a seasonally adjusted annual rate, up 0.5 percent from August, but still down 10 percent from September 2009. Private nonresidential construction was reported down 25 percent for the year. New housing starts are running at less than half the normal volume based on decades of figures. The only thing up recently is public construction, which climbed 1.3 percent for the year, in part due to federal stimulus funding. In contrast, public education funding fell 4.8 percent for the year because that is funded mostly by state and local revenues.

Potentially the biggest disappointment to the construction industry was the failure of the stimulus package to focus more on infrastructure. During an NCS interview with Congressman John Mica, he revealed that only 7 percent, or about $63 billion, of the $862 billion stimulus package went to infrastructure, and as late as September less than 35 percent of those funds had been spent, which means that more than $40 billion is still sitting there, unspent.

During the boom period, the construction industry was operating at peak capacity. It was difficult to find qualified workers and managers. Construction commodities, such as cement, steel and other metals, were in short supply. This drove costs to very high levels. The combination of these factors made it difficult for the nation to invest in its infrastructure. The result is, according to the ASCE, the backlog of work exceeds $2 trillion. However, now the industry has significant unused capacity and, in fact, could use help in putting millions of workers back to work while restoring our infrastructure at a reasonable cost. Unfortunately this opportunity was missed. In contrast, countries such as Russia, Qatar, Saudi Arabia and the United Arab Emirates are focusing on infrastructure.

During his interview, Congressman Mica, the incoming chairman of the Transportation and Infrastructure Committee, reported that he and Congressman James Oberstar, the outgoing committee chairman, pushed to get a six-year transportation commitment. Unfortunately the White House said it would not support a six-year plan; it wouldn't support anything longer than 18 months. In the end the extension was only to the end of the year. Mica explained the problem with these short time spans is the states don't have the necessary commitment for long-term funding necessary for large projects. This resulted in money being spent on resurfacing contracts, bike paths and other similar projects. He argued that larger long-term projects are needed to stimulate the economy.

Since the crisis has caused a lot of pain throughout the world. Those investing or lending capital have become very cautious. It doesn't matter if you are in Europe, the Middle East or the United States; the same message keeps coming up,  We need financing for projects. It is easy to argue that people are overreacting, but think about Dubai, which has seen real estate prices drop by as much as 60 percent, and some are predicting further drops. Consider the United States, which is experiencing record foreclosures of homes. Even the exuberant world of Las Vegas is not immune. The new Harmon Hotel, which hasn't even opened, is cowering under the threat of demolition. These are crazy times.

Several years ago, when rebar prices were through the roof and causing contractors significant pain, one person came up to me after a presentation and said,  The large increase in rebar prices is the best thing that has happened. I was surprised by his comment because everyone else was complaining. I asked,  Why do you think it is good?

He responded,  It's so bad, they will have to do something about it.

I thought he had a good point then, and I still do.

Professor John Kotter, author of Sense of Urgency and one of my NCS Radio guests, has stated that the most important issue in creating significant sustainable change is a sense of urgency. After a year where unemployment in the construction industry has gone to more than 25 percent, where volume is down significantly and where profit is a mere wish for many companies, maybe the sense of urgency is strong enough that industry leaders will begin making the necessary changes, not only for the practitioners and workforce, but also for the clients the industry serves.

I didn't report on lot of things happening in 2010 mainly because not a lot happened, except for doom and gloom. The industry has lost its swagger, just a like a sports team in the middle of losing streak. However, the industry has incredible talent, and it's time we put it to use fixing the industry, not just building structures.