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
Green Renovation | Mar 5, 2023
Dept. of Energy offers $22 million for energy efficiency and building electrification upgrades
The Buildings Upgrade Prize (Buildings UP) sponsored by the U.S. Department of Energy is offering more than $22 million in cash prizes and technical assistance to teams across America. Prize recipients will be selected based on their ideas to accelerate widespread, equitable energy efficiency and building electrification upgrades.
Windows and Doors | Mar 5, 2023
2022 North American Fenestration Standard released
The 2022 edition of AAMA/WDMA/CSA 101/I.S.2/A440, “North American Fenestration Standard/Specification for windows, doors, and skylights” (NAFS) has been published. The updated 2022 standard replaces the 2017 edition, part of a continued evolution of the standard to improve harmonization across North America, according to a news release.
AEC Innovators | Mar 3, 2023
Meet BD+C's 2023 AEC Innovators
More than ever, AEC firms and their suppliers are wedding innovation with corporate responsibility. How they are addressing climate change usually gets the headlines. But as the following articles in our AEC Innovators package chronicle, companies are attempting to make an impact as well on the integrity of their supply chains, the reduction of construction waste, and answering calls for more affordable housing and homeless shelters. As often as not, these companies are partnering with municipalities and nonprofit interest groups to help guide their production.
Modular Building | Mar 3, 2023
Pallet Shelter is fighting homelessness, one person and modular pod at a time
Everett, Wash.-based Pallet Inc. helped the City of Burlington, Vt., turn a municipal parking lot into an emergency shelter community, complete with 30 modular “sleeping cabins” for the homeless.
Codes | Mar 2, 2023
Biden Administration’s proposed building materials rules increase domestic requirements
The Biden Administration’s proposal on building materials rules used on federal construction and federally funded state and local buildings would significantly boost the made-in-America mandate. In the past, products could qualify as domestically made if at least 55% of the value of their components were from the U.S.
Industry Research | Mar 2, 2023
Watch: Findings from Gensler's latest workplace survey of 2,000 office workers
Gensler's Janet Pogue McLaurin discusses the findings in the firm's 2022 Workplace Survey, based on responses from more than 2,000 workers in 10 industry sectors.
AEC Innovators | Mar 2, 2023
Turner Construction extends its ESG commitment to thwarting forced labor in its supply chain
Turner Construction joins a growing AEC industry movement, inspired by the Design for Freedom initiative, to eliminate forced labor and child labor from the production and distribution of building products.
Multifamily Housing | Mar 1, 2023
Multifamily construction startup Cassette takes a different approach to modular building
Prefabricated modular design and construction have made notable inroads into such sectors as industrial, residential, hospitality and, more recently, office and healthcare. But Dafna Kaplan thinks that what’s held back the modular building industry from even greater market penetration has been suppliers’ insistence that they do everything: design, manufacture, logistics, land prep, assembly, even onsite construction. Kaplan is CEO and Founder of Cassette, a Los Angeles-based modular building startup.
AEC Innovators | Feb 28, 2023
Meet the 'urban miner' who is rethinking how we deconstruct and reuse buildings
New Horizon Urban Mining, a demolition firm in the Netherlands, has hitched its business model to construction materials recycling. It's plan: deconstruct buildings and infrastructure and sell the building products for reuse in new construction. New Horizon and its Founder Michel Baars have been named 2023 AEC Innovators by Building Design+Construction editors.
Airports | Feb 28, 2023
Data visualization: $1 billion earmarked for 2023 airport construction projects
Ninety-nine airports across 47 states and two territories are set to share nearly $1 billion in funding in 2023 from the Federal Aviation Administration. The funding is aimed at help airports of all sizes meet growing air travel demand, with upgrades like larger security checkpoints and more reliable and faster baggage systems.
