NRCI: Economic recovery slow for nonresidential construction

Nonresidential Construction Index: the slow recovery continues, says report.

05/25/2011


FMI, a large provider of management consulting and investment banking to the engineering and construction industry, has announced the release of its Nonresidential Construction Index (NRCI) report for the second quarter of 2011.

In spite of adjustments made to accommodate the rising cost of materials, the NRCI moved up 1.4 points to 58.7 for the second quarter. For the fifth quarter in a row, the Index has remained at least slightly in positive territory. The slow, uneven recovery of nonresidential construction mirrors the mixed signals from the national economy, where consumer spending begins to improve just as gas prices skyrocket, and automotive sales start to bounce back as an unparalleled disaster in Japan takes billions of dollars in parts and automotive manufacturing offline.

With the notable exceptions of increasing material and labor costs, most of the major components of the NRCI improved slightly or stayed about the same as last quarter. However, current issues for the Q2 NRCI indicate some challenges to come for nonresidential construction. For instance, 86.5 percent of NRCI panelists favor severe cuts in infrastructure spending if it will help bring the deficit down and promote sustainable government spending even though those contractors stand to lose a lot of potential work. Panelists expect threats and maybe some future opportunities as the markets begin to feel the effects of multiple natural disasters and political upheaval in the Middle East and Northern Africa.

In the meantime, panelists continue to work harder to improve their backlogs, and that effort includes maintaining good relationships with their customers. In this case, the challenges include keeping those customers in the face of low-bid competitors as loyalty is challenged when owners can only see low prices. Most panelists expect loyal customers to return as the economy improves, but 26 percent expect to be doing more work with new customers after the recession.

Download the complete NRCI report here.



No comments
Consulting-Specifying Engineer's Product of the Year (POY) contest is the premier award for new products in the HVAC, fire, electrical, and...
Consulting-Specifying Engineer magazine is dedicated to encouraging and recognizing the most talented young individuals...
The MEP Giants program lists the top mechanical, electrical, plumbing, and fire protection engineering firms in the United States.
High-performance buildings; Building envelope and integration; Electrical, HVAC system integration; Smoke control systems; Using BAS for M&V
Pressure piping systems: Designing with ASME; Lab ventilation; Lighting controls; Reduce energy use with VFDs
Smoke control: Designing for proper ventilation; Smart Grid Standard 201P; Commissioning HVAC systems; Boilers and boiler systems
Case Study Database

Case Study Database

Get more exposure for your case study by uploading it to the Consulting-Specifying Engineer case study database, where end-users can identify relevant solutions and explore what the experts are doing to effectively implement a variety of technology and productivity related projects.

These case studies provide examples of how knowledgeable solution providers have used technology, processes and people to create effective and successful implementations in real-world situations. Case studies can be completed by filling out a simple online form where you can outline the project title, abstract, and full story in 1500 words or less; upload photos, videos and a logo.

Click here to visit the Case Study Database and upload your case study.

Protecting standby generators for mission critical facilities; Selecting energy-efficient transformers; Integrating power monitoring systems; Mitigating harmonics in electrical systems
Commissioning electrical systems in mission critical facilities; Anticipating the Smart Grid; Mitigating arc flash hazards in medium-voltage switchgear; Comparing generator sizing software
Integrating BAS, electrical systems; Electrical system flexibility; Hospital electrical distribution; Electrical system grounding
As brand protection manager for Eaton’s Electrical Sector, Tom Grace oversees counterfeit awareness...
Amara Rozgus is chief editor and content manager of Consulting-Specifier Engineer magazine.
IEEE power industry experts bring their combined experience in the electrical power industry...
Michael Heinsdorf, P.E., LEED AP, CDT is an Engineering Specification Writer at ARCOM MasterSpec.