Construction Industry Review & Outlook: ENR & Experts Weigh In
Shortly before releasing the results of its 2015 Top 400 Contractors survey Wednesday, Engineering News-Record (ENR) magazine hosted a webinar offering key findings from this year’s survey and insights into the future of construction. ENR Senior Editor Gary Tulacz was joined by CEO of Gray Construction Stephen Gray, Senior Vice President of HITT Contracting, Inc. Kim Roy and President and CEO of Sundt Construction David Crawford for the discussion.
Described as “somewhat of a mixed bag,” the overall contracting market showed modest, but steady growth in 2014 offering a 2.4 percent increase over 2013 revenue. The domestic market showed stronger growth at 7.8 percent, despite concerns in infrastructure and oil markets. While domestic revenue growth was undoubtedly strong, Tulacz said it still has quite a way to go before it could stack up to the pre-crash 2008 industry market.
Furthering signs of gradual industry rebound, it was reported that nearly two thirds of contractors saw 2014 revenue growth. In terms of market share of total revenue, general building took the top spot by a landslide, responsible for 45.5 percent of all revenue. The “Top 400 At A Glance” diagram below provides a quick glimpse at how the top contractors are stacking up in today’s marketplace.
Kicking off the panel discussion was Stephen Gray, who said the outlook for Gray’s markets is still quite strong, largely due to a continued interest in U.S. manufacturing. “The U.S. is a great place to be for foreign manufacturers,” said Gray. “At the end of the day, the rest of the world still looks at the U.S. as the safest place to invest a dollar.” Gray added that the nation’s energy prices and workforce are also drawing foreign OEMs to American manufacturing.
In addition to positive momentum for U.S. manufacturing, Gray said that the industry is also seeing a continued focus on safety. “The big thing that we see these days and really have to spend a lot of our time on is safety. It’s something that we see as very important,” remarked Gray, whose company received the industry’s highest safety award in the nation in 2014.
Though the construction industry faces challenges ahead ranging from uncertain energy regulations to rising labor costs, the tone is hardly negative. In fact, the outlook is strong because:
- Building projects are continuing to rise
- Independent investments are beginning to rise
- Lower oil prices are benefitting certain markets
- States are stepping up their efforts on infrastructure
- Public-private partnership projects are on the rise
- Project delivery tools, such as BIM, are improving
- Materials’ prices are remaining relatively stable
Also discussed were trends in technology that are changing the construction process, strategies for success in a challenging market, the effect of oil prices on business and the labor shortage.