A sinking economy, resulting in cutbacks in construction projects and a tightening of credit, is just one of the looming challenges facing surety and fidelity bond underwriters as their association celebrated its 100th anniversary in Washington last week.

There are critical but longer-term challenges to tackle, such as recruiting young professionals and minorities, as well as educating private and public sector buyers and others who depend on bond insurers about the role and value of the industry.

But with housing construction slowing down considerably, and construction firms having a harder time getting credit in the wake of the subprime mortgage crisis, shrinking opportunities to write business is the most immediate concern, according to Rick Kinnaird, chair of the Surety and Fidelity Association of America.