FMI Releases 2021 Industry Overview

In their latest report, FMI economists share their outlook for 2021 in the US and Canadian construction and engineering industries. The authors opine that 2021 will be about finding opportunities amid...

In their latest report, FMI economists share their outlook for 2021 in the US and Canadian construction and engineering industries. The authors opine that 2021 will be about finding opportunities amid uncertainty.

Now that we are almost two months into the new year, it’s become clear that the many challenges facing the industry are not fading as quickly as once was thought. Instead, COIVD-19 continues to cause tremendous uncertainty over how the first quarter and beyond will unfold.

The authors the FMI forecast report anticipate a continued dissipation of the current recession. However, significant risks remain intact throughout the economy.

Key highlights of the report include:

  • Total engineering and construction spending for the U.S. is forecast to end 2020 up 1% compared to up 2% in 2019.

  • Looking ahead to 2021, FMI forecasts a 6% decline in engineering and construction spending levels compared to 2020.

  • Primary growth segments in 2020 are expected to be limited to residential improvements, single-family construction, public safety and water supply infrastructure, all with growth rates of 5% or higher.

  • Some mixed public and private segments (multifamily, commercial, health care, communication, sewage and waste disposal, and conservation and development) are expected to end 2020 with growth roughly in line with the rate of inflation and therefore be considered stable.

  • Most nonresidential building segments (i.e., lodging, office, educational, religious, amusement and recreation, transportation and manufacturing) alongside the largest nonbuilding structures segments (i.e., power and highway and street) are expected to end 2020 in decline.

  • The latest Nonresidential Construction Index (NRCI) feedback suggests increased optimism for the first quarter of 2021, at 47.1, up from 45.6 in the quarter prior. The index however remains below the growth threshold of 50, suggesting fewer engineering and construction opportunities in 2021.

Go more in-depth by reading the U.S. report or the Canada report published by FMI.