The first thing I do once I return to my office following World of Concrete (WOC) is organize the business cards I acquired during the week and begin my follow-up calls. I always enjoy the range and diversity of the people I meet during WOC, as the show draws the best general and concrete contractors from all corners of the globe.
Soon after I started my follow-up calls, I was quickly reminded of how successful WOC 2011 was to both exhibitors and attendees alike. Conversation focused on how great the show was, the importance of attending the show each year, and the 2011 construction season. Morale in the industry is high, and spirits are good right now. Equipment orders have been made, and contractors are securing business for the next few months.
Concurrent to my WOC follow-up conversations, a news release from the Associated General Contractors of America (AGC), Arlington, Va., landed in my email inbox. The title of the press release immediately garnered my attention: “More Construction Firms Plan to Hire, Instead of Cutting Workers in 2011.”
According to a survey by the AGC and Navigant, Chicago, more construction firms are planning to hire workers this year than are planning to make layoffs. Digging further into the numbers, approximately 1300 construction firms in 49 states, the District of Columbia, and Puerto Rico—representing a broad range of segments in the construction industry—responded to the survey about their hiring, equipment purchasing, and business plans.
In 2011, 27% of construction firms report they plan to add staff while only 20% are planning layoffs. Further, the expanding firms plan to hire an average of 23 employees, while contracting firms plan to layoff an average of 16 employees. In comparison to 2010, 55% of construction firms laid off staff, and 20% added employees. OK, so the hiring numbers aren’t staggering, but at least they point in the right direction.
However, the contractors in this survey are still skeptical about the 2011 construction market. More than 50% of contractors expect the private office market activity to decline; and 52% expect declines in retail, warehouses, and lodging. Optimism lies in hospitals and higher education as 32% of contractors expect growth; and the power market where 29% expect growth. On the flip side, 36% of contractors expect the hospital and higher education market to reduce, and 32% expect the power market to shrink.
What can you take away from this information? For one thing, there is still a lot of uncertainty for the 2011 construction marketplace. As in recent years, areas of the country will feel the boom as other areas remain depressed. However, circling back to the mood at WOC, there is still some optimism about 2011. Many contractors I spoke with at WOC defined 2010 in the average to good range, and expect more of the same in 2011. What are your expectations for 2011?