The U.S. economy gave us something of a head fake in 2016 – dribbled around a slowdown, and took the economy in for a score as basketball season began at the end of the fourth quarter. Prior to that, in the third quarter, most forecasters expected a slow end to the year (or worse) as the political rhetoric heated up.
As always, the construction outlook for 2017 and beyond has a mixture of good and bad signs. For instance, the unemployment rate for construction workers is now in line with the unemployment rate for all workers at around 4.5%. There are still many unemployed who are not counted as jobseekers anymore, resulting in a difficult problem: workers increasingly displaced by technologies or employers relocating, growing, downsizing, etc.
The construction industry is also involved, finding it difficult to hire the right skilled workers at the right time and in the right place. Employment will continue to be a challenge for the foreseeable future. If the consumer is king, who pays the wages that consumers spend?
The “good” indicators for 2017:
- GDP is up
- Employment remains high
- Construction industry wages in are up
- The Federal Reserve managed to increase the interest rate, and expect more increases in 2017
- CPI remains low
- Oil and gas prices are working their way up again
- Consumer confidence is high
For construction, we expect a 1% increase in construction put-in-place growth over the 5% in 2016.
NSCA members should once again be optimistic in looking forward for the next several years. Overall healthy, steady growth seems to be on the horizon for most markets served by NSCA members. Our specific systems, which are specified into each project, continue to grow and expand. The charts within the new Electronic Systems Outlook Winter 2016 report will give you an indication of the projected demand for these technologies as they apply to each vertical market.
Especially exciting is the outlook for Canada. We underestimated how devastating the last few years have been on the overall commercial construction-related projects in Canada, but are now pleased to report a very strong comeback. We must remain mindful of our lagging revenue recognition periods as we look at the forecast for Canada.
The No. 1 factor in growth potential for the integration community hinges on our ability to find skilled workers. More than 47% of our members rank this as the largest barrier to growth. The new NSCA IGNITE program is in full swing now; all indications appear to be that it is creating awareness about our industry and filling the void in skilled-worker shortage. Nearly every NSCA member reports that they have unfilled positions in key roles, which limits capacity and makes scheduling difficult. We encourage all members to implement a proactive talent management program and build depth in highly skilled positions.
Download the Electronic Systems Outlook Winter 2016 report now – free for Gold and Platinum NSCA members, and available for purchase at $199 for Bronze and Silver members.
We will also host a free one-hour webinar on Feb. 21, 2017, for integrators that want to learn more about the data and how it can be used within their organizations.