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 | Nov 2, 2020
More contractors report canceled projects than starts, survey finds
Construction employment declined in most metros in latest 12 months.
Multifamily Housing | Oct 30, 2020
The Weekly show: Multifamily security tips, the state of construction industry research, and AGC's market update
BD+C editors speak with experts from AGC, Charles Pankow Foundation, and Silva Consultants on the October 29 episode of "The Weekly." The episode is available for viewing on demand.
Hotel Facilities | Oct 27, 2020
Hotel construction pipeline dips 7% in Q3 2020
Hospitality developers continue to closely monitor the impact the coronavirus will have on travel demand, according to Lodging Econometrics.
Market Data | Oct 22, 2020
Multifamily’s long-term outlook rebounds to pre-covid levels in Q3
Slump was a short one for multifamily market as 3rd quarter proposal activity soars.
Market Data | Oct 21, 2020
Architectural billings slowdown moderated in September
AIA’s ABI score for September was 47.0 compared to 40.0 in August.
Market Data | Oct 21, 2020
Only eight states top February peak construction employment despite gains in 32 states last month
California and Vermont post worst losses since February as Virginia and South Dakota add the most.
Market Data | Oct 20, 2020
AIA releases updated contracts for multi-family residential and prototype residential projects
New resources provide insights into mitigating and managing risk on complex residential design and construction projects.
Market Data | Oct 20, 2020
Construction officials call on Trump and Biden to establish a nationwide vaccine distribution plan to avoid confusion and delays
Officials say nationwide plan should set clear distribution priorities.
Market Data | Oct 19, 2020
5 must reads for the AEC industry today: October 19, 2020
Lower cost metros outperform pricey gateway markets and E-commerce fuels industrial's unstoppable engine.
Market Data | Oct 19, 2020
Lower-cost metros continue to outperform pricey gateway markets, Yardi Matrix reports
But year-over-year multifamily trendline remained negative at -0.3%, unchanged from July.
