Despite signs the economy is starting to improve, spending on nonresidential construction is expected to decrease by 13.4 percent in 2010 and increase only 1.8 percent in 2011 in inflation adjusted terms.

Commercial and industrial projects will continue to see the biggest drop in activity. Building for institutions will fare better, thanks in part to federal stimulus spending.

These are highlights from the American Institute of Architects' semi-annual Consensus Construction Forecast, which AIA says is a survey of the nation's leading construction forecasters.

“When economies emerge from (a) prolonged recession, recovery for nonresidential construction activity typically takes longer,” AIA Chief Economist Kermit Baker said in a news release about the forecast.

“Hardest hit will be the commercial and industrial sectors, with projected declines in the 20 percent range for 2010 in most building categories. Led by the health care market, the institutional sector will see far less dramatic declines and should help lead the construction industry into recovery in 2011.”

The AIA Consensus Construction Forecast Panel is conducted twice a year with forecasters including Global Insight, Moody's economy.com, Reed Business Information, the Portland Cement Association and FMI.

The purpose is to project conditions in the construction industry over 12 to 18 months.