Uptick in Construction Activity Will Challenge You to Innovate
August 1, 2011
More than half of the nation’s largest plumbing and mechanical contractors - 51.4% - expect their workload to increase this year. An even larger number - 55% - predict their business will grow in 2012.
You may be experiencing this uptick in your business, since many of you design the systems these contractors install. If nothing else, these numbers represent positive signs the construction industry is heading in the right direction.
The upward-pointing arrows come from pme’s sister publication, Plumbing & Mechanical (www.PMMag.com). Each year, PM and BNP Media’s research department send a Pipe Trades Giants survey to the magazine’s largest subscribers to ask them about the volume of their work coming from plumbing, piping, hydronics, fire protection and water/wastewater treatment projects.
Construction spending in 2010 totaled $814.2 billion, a 10.3% decrease from 2009 figures. Business from nonresidential projects was down 23.3%, with lodging and office construction the hardest hit - down 48.7% and 27%, respectively.
Even the numbers for so-called bright spots such as public buildings, health-care facilities and schools had minus signs attached to them in 2010. Public building projects declined 2.7% while health care decreased 2% and education dropped 1.5%.
Showing positive growth, construction of power plants soared 73.3% last year from 2009. Industry consultant FMI predicts a modest 2% gain in power plants in 2011.
“Power will continue to be a growing construction market as there is no sign that our need for more of it will abate,” according to FMI’s “Construction Outlook: Second Quarter 2011 Report.”
“We expect growth to accelerate over the next five years as more attention is paid to renewable energy sources.”
Our survey supports this trend. About one-third of repondents installed solar thermal (32.1%) and geothermal (34.9%) systems in 2010. Three-fourths (74.3%) took part in building a LEED-certified structure last year.
In addition, 54% of respondents to PM’s survey say they actively discuss with their customers the advantages of installing ENERGY Star-certified appliances, such as water heaters; 35% discuss WaterSense-certified fixtures such as toilets with customers. Contractors whose comments accompany PM’s survey findings repeatedly mention energy and water efficiency.
“We have always focused on value of return on projects,” one contractor tells us. “But with the new focus on energy costs, we have developed our business model over the past several years to focus on energy services projects with guaranteed energy savings.”
Engineers are moving in the same direction. In a new feature this month - pme Profile - Brad Hanson, P.E., states: “We are seeing owners investing in green technologies for energy savings that can offer attractive paybacks. Incentives from the government and programs such as Focus on Energy are becoming more prevalent in the projects we design. We are being challenged to think outside the box even more to develop systems that are cost-effective and energy-efficient.”
Expect the challenge to innovate to continue for the remainder of 2011, next year and into the foreseeable future. You can help building owners use of our natural resources more efficiently as you help them save money.