Engineering firm CEOs upbeat about financial performance, industry employment

U.S. engineering firm CEOs remain encouraged about overall company performance and market trends. They also see strong signs of recovery in industry employment, this according to the latest ACEC Engineering Business Index (EBI), which charts the health of the engineering industry.

EBI is a diffusion index, consolidating hundreds of engineering leader responses nationwide on market and firm performance into a single “confidence” number. Any score over 50 indicates expansion.

The third quarter EBI (Q3), conducted Sept. 17 to Oct. 3 of 275 engineering CEOs, presidents and chairmen, produced a positive composite score of 68.8, virtually unchanged from 68.9 in the second quarter.

Survey respondents reported a strong rebound in hiring: 67.4% said employment at their firm was equal to or higher now than pre-recession (2008) levels; 25% said employment was “at least 10%” higher. Only 32.7% said employment was lower.

Engineering leaders remained encouraged by company performance: 65% reported higher backlogs compared to this time last year—significantly more than the 51% in the second quarter. Almost half of Q3 respondents (49.3%) expect backlogs to increase further over the next 12 months.

Respondents also believe most private markets will continue to thrive: 61.7% expect improvement over the coming year in Land Development, 56.1% in Energy and Power, and 53.1% in Buildings and Commercial.

Public market expectations, however, continue to lag: only 43.8% of respondents believe the Water and Wastewater segment will improve by next year; only 39.7% said Transportation will improve.

For the complete Q3 summary of ACEC’s Engineering Business Index (EBI) go to www.acec.org.