flexiblefullpage
billboard
interstitial1
catfish1
Currently Reading

Construction contractor confidence surges into 2020, says ABC

Market Data

Construction contractor confidence surges into 2020, says ABC

Sales and profit margin expectations reached their highest levels since May 2019.


By Associated Builders and Contractors | January 23, 2020
Construction contractor confidence surges into 2020, says ABC

More than 50% of contractors expect their profit margins to increase over the next six months. Photo by Quintin Gellar from Pexels

  

Confidence among U.S. construction industry leaders increased in November 2019 with respect to sales, profit margins, and staffing, according to the Associated Builders and Contractors Construction Confidence Index. 

Sales and profit margin expectations reached their highest levels since May 2019, while staffing expectations reached their highest level since April 2019.

Three-quarters of contractors expect sales to rise over the next six months and, as a result, nearly 65% expect to increase their staffing levels, indicating that the average contractor will face even greater challenges recruiting and retaining talent through the first half of 2020.

 

 

More than 50% of contractors expect their profit margins to increase over the next six months for the first time since August 2019. Fewer than 12% expect margins to decline, strongly suggesting that demand for construction services remains elevated and purchasers are willing to pay enough to offset rising compensation costs.

• The CCI for sales expectations increased from 63.8 to 69.5 in November.
• The CCI for profit margin expectations increased from 58.8 to 61.3.
• The CCI for staffing levels increased from 63.6 to 66.9.

“The U.S. economy retains significant momentum entering 2020,” said ABC chief economist Anirban Basu. “Accordingly, the nonresidential construction outlook remains stable. The duration of the economic expansion—already record-shattering—has more room to run. ABC’s Construction Backlog Indicator remained virtually unchanged at 8.8 months in November, and with job growth still apparent, demand for office and other forms of commercial construction will persist. Improved state and local government finances working in conjunction with ultra-low interest rates are helping to fuel additional spending in a variety of infrastructure-related categories, including water systems, flood control and public safety. Though there will always be reasons for concern, including those related to geopolitics, the achievement of a first phase trade deal with China and the new United States-Mexico-Canada trade agreement, which replaced NAFTA, should provide much-needed certainty regarding near-term economic prospects.”

CCI is a diffusion index. Readings above 50 indicate growth, while readings below 50 are unfavorable. 

Related Stories

Market Data | Jun 11, 2020

5 must reads for the AEC industry today: June 11, 2020

Istanbul opens largest base-isolated hospital in the world and AIA issues tools for reducing risk of COVID-19 transmission in buildings.

Market Data | Jun 10, 2020

6 must reads for the AEC industry today: June 10, 2020

Singapore's newest residential district and CannonDesign unveils COVID Shield.

Market Data | Jun 9, 2020

ABC’s Construction Backlog Indicator inches higher in May; Contractor confidence continues to rebound

Nonresidential construction backlog is down 0.8 months compared to May 2019 and declined year over year in every industry.

Market Data | Jun 9, 2020

6 must reads for the AEC industry today: June 9, 2020

OSHA safety inspections fall 84% and the office isn't dead.

Market Data | Jun 8, 2020

Construction jobs rise by 464,000 jobs but remain 596,000 below recent peak

Gains in may reflect temporary support from paycheck protection program loans and easing of construction restrictions, but hobbled economy and tight state and local budgets risk future job losses.

Market Data | Jun 5, 2020

7 must reads for the AEC industry today: June 5, 2020

The world's first carbon-fiber reinforced concrete building and what will college be like in the fall?

Market Data | Jun 4, 2020

7 must reads for the AEC industry today: June 4, 2020

Construction unemployment declines in 326 of 358 metro areas and is the show over for AMC Theatres?

Market Data | Jun 3, 2020

Construction employment declines in 326 out of 358 metro areas in April

Association says new transportation proposal could help restore jobs.

Market Data | Jun 3, 2020

6 must reads for the AEC industry today: June 3, 2020

5 ways to improve cleanliness of public restrooms and office owners are in no hurry for tenants to return.

Market Data | Jun 2, 2020

Architects, health experts release strategies, tools for safely reopening buildings

AIA issues three new and enhanced tools for reducing risk of COVID-19 transmission in buildings.

boombox1
boombox2
native1

More In Category




halfpage1

Most Popular Content

  1. 2021 Giants 400 Report
  2. Top 150 Architecture Firms for 2019
  3. 13 projects that represent the future of affordable housing
  4. Sagrada Familia completion date pushed back due to coronavirus
  5. Top 160 Architecture Firms 2021