The Trump Administration’s plans for infrastructure investment, regulatory reform, and tax relief have ignited a burst of enthusiasm among U.S. engineering firm leaders, propelling the American Council of Engineering Companies’ Engineering Business Index (EBI) to its largest ever quarterly increase.
The 4th Quarter 2016 (Q4/2016) EBI surged 5.1 points to 66.5, up from the 61.4 score of Q3/2016. The previous largest increase was 1.5 points between the Q1/2014 and Q2/2014 surveys. Any score above 50 signifies that the market is growing The EBI is a leading indicator of America’s economic health based on the business performance and projections of engineering firms responsible for developing the nation’s transportation, water, energy, and industrial infrastructure. The Q4/2016 survey of 317 engineering firm leaders was conducted November 31 to December 20.
Survey results show firm leader market expectations for one year from today rose a hefty 8.8 points to 72.1, the largest quarter-over-quarter increase since the EBI’s inception in January 2014. Expectations for both short- and long-term profitability also climbed. Firm leader optimism for improved profitability over the next six months rose 3.6 points to 69.0; increased to 72.9 for one year from now; and climbed 2.9 points to 70.5 for three years from now.
“We finally have a president who understands business!” says one respondent. “We’re looking forward to some significant tax relief with the new Administration,” says another.
The boost in firm leader optimism extends across almost the entire engineering marketplace. In public markets, transportation showed the strongest increase, up an eye-catching 9.5 points to 73.7.
All other public market sectors rose: Water and Wastewater (up 7.5, to 70.5), Education (up 3.2 to 58.2) Health Care (up 0.3, to 56.1), and Environmental (up 1.1 to 55.4). A new public sector category, Buildings, debuted at 65.2. Among the private client markets, firm leaders were most bullish about the Industrial/Manufacturing sector, which leaped up 12.5 points to 70.7. Four key private sector markets also climbed: Energy and Power (up 8.8, to 69.2), Land Development (up 8.2, to 68.4.), Buildings (up 4.1 to 67.0), and Education (up 5.2, to 58.5).
For the complete Quarter 4, 2016 Engineering Business Index, go to www.acec.org.
Related Stories
Market Data | Dec 19, 2018
When it comes to economic clout, New York will far outpace other U.S. metros for decades to come
But San Jose, Calif., is expected to have the best annual growth rate through 2035, according to Oxford Economics’ latest Global Cities report.
Market Data | Dec 19, 2018
Run of positive billings continues at architecture firms
November marked the fourteenth consecutive month of increasing demand for architectural firm services.
Market Data | Dec 5, 2018
ABC predicts construction sector will remain strong in 2019
Job growth, high backlog and healthy infrastructure investment all spell good news for the industry.
Market Data | Dec 4, 2018
Nonresidential spending rises modestly in October
Thirteen out of 16 subsectors are associated with year-over-year increases.
Market Data | Nov 20, 2018
Construction employment rises from October 2017 to October 2018 in 44 states and D.C.
Texas has biggest annual job increase while New Jersey continues losses; Iowa, Florida and California have largest one-month gains as Mississippi and Louisiana trail.
Market Data | Nov 15, 2018
Architecture firm billings continue to slow, but remain positive in October
Southern region reports decline in billings for the first time since June 2012.
Market Data | Nov 14, 2018
A new Joint Center report finds aging Americans less prepared to afford housing
The study foresees a significant segment of seniors struggling to buy or rent on their own or with other people.
Market Data | Nov 12, 2018
Leading hotel markets in the U.S. construction pipeline
Projects already under construction and those scheduled to start construction in the next 12 months, combined, have a total of 3,782 projects/213,798 rooms and are at cyclical highs.
Market Data | Nov 6, 2018
Unflagging national office market enjoys economic tailwinds
Stable vacancy helped push asking rents 4% higher in third quarter.
Market Data | Nov 2, 2018
Nonresidential spending retains momentum in September, up 8.9% year over year
Total nonresidential spending stood at $767.1 billion on a seasonally adjusted, annualized rate in September.
