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2021 Heavy Civil Construction Index: Second Quarter Report | FMI

2021 Heavy Civil Construction Index:
Second Quarter Report

The second quarter 2021 Heavy Civil Construction Index shows contractor sentiment has returned to positive territory for the first time in a year. This seems to align with much of the general economic news making headlines recently.

In the third quarter of last year, the index fell below 50 for the first time in at least three years, plunging to 34.9. Since then, it has gradually improved to its current level of 55.8.

When reviewing the individual components that comprise the index, it’s worth noting that contractors are more optimistic about the broader economy. Index scores are greatest for the overall U.S. economy and the economy where respondents do business and somewhat lower in the particular markets in which they operate. This is a shift from last quarter where optimism decreased for the broader perspectives.

All components are trending positive, except for cost of materials and labor, both of which are of growing concern for contractors where they do not have opportunities to protect against price escalation. These items are both important risk factors to pay attention to this coming year.

Compared to last quarter, optimism across all sectors has increased substantially. Residential site development continues to lead with strong ongoing expectations, followed by highway/bridge and commercial site development. Respondents were generally less optimistic across other transportation segments, including port/marine/docks, aviation and transit/rail.

INDEX MOVEMENT

To access the full report including all charts and graphs, please click below to download.


Brian Moore is a principal and strategy practice leader with FMI. Brian focuses on consulting with contractors on various strategic, organizational and operational issues. Brian works in identifying future construction trends, market conditions and competitive issues that impact strategic decisions. Brian’s clients count on him as a thought leader and trusted advisor as they plan the future of their business. He works with clients to help them develop the organizational capabilities that match their chosen strategy so they can achieve desired results. Brian can be reached at bmoore@fminet.com.
Paul Trombitas is a senior consultant with FMI’s strategy practice and works with clients across the engineering and construction industry. He is responsible for managing and delivering in-depth market insights focused on the Built Environment. He is actively involved with clients in developing market strategy, focusing on alternative project delivery methods. Paul has been quoted in multiple publications, including ENR, regarding the design-build market and maintains key stakeholder relationships that provide unparalleled industry access. Paul can be reached at ptrombitas@fminet.com.
Brian Strawberry is a senior economist with FMI. Brian’s expertise is in economic and statistical modeling. He leads FMI’s efforts in market sizing, forecasting, and building product/construction material pricing and consumption trends. The combination of Brian’s analytical skills and creative problem-solving abilities has proven valuable for many contractors, owners and private equity groups as well as industry associations and internal research initiatives. Brian can be reached at bstrawberry@fminet.com.
Emily Beardall is a consultant for FMI’s strategy practice. Emily is responsible for creating and developing tools to deliver innovative solutions for our clients. She is committed to utilizing these strategic tools to improve company performance and profitability. Emily can be reached at ebeardall@fminet.com.