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"Total engineering and construction spending for the U.S. is forecast to end flat, or less than -1 percent in 2020, compared to 2 percent growth in 2019."
RALEIGH, NC, September 30, 2020 /24-7PressRelease/ -- FMI Corporation, the leading provider of consulting and investment banking services to the Built Environment, is pleased to announce the release of its third quarter 2020 North American Engineering and Construction Outlook. The publication offers comprehensive construction forecasts for a broad range of market segments and geographies in the U.S. and Canada as well as information on key market drivers.
Recent economic disruptions considered in the following forecast include the domestic and foreign impact of COVID-19, high volatility across financial and equity markets, emergency policies set in place by the Federal Reserve, lower oil prices, and mounting political uncertainty in addition to nationwide social unrest headed into the 2020 presidential election.
Based on unprecedented government support, FMI is anticipating the 2020 recession to continue to dissipate. However, anticipated corrections across residential markets are at risk of contributing toward ongoing economic losses and an elongated downtrend in nonresidential construction spending over the next several years.
Key highlights of the report include:
• Total engineering and construction spending for the U.S. is forecast to end flat, or less than -1 percent in 2020, compared to 2 percent growth in 2019.
• Declines will be led by an abrupt contraction in nonresidential building markets. Current anticipated low-performing segments forecast in 2020 include religious (-21 percent), lodging (-14 percent), amusement and recreation (-9 percent), educational (-7 percent) and office (-5 percent).
• Multiple segments that were previously in down categories have been upgraded this quarter to reflect upheld market conditions and investment levels. Based on strong second quarter actuals, year-end forecasts for public safety (9 percent), water supply (9 percent), residential improvements (6 percent), communication (4 percent) and sewage and waste disposal (4 percent) have all been revised and improved substantially.
• FMI's third quarter 2020 Nonresidential Construction Index (NRCI) at 45.6 reflects a large improvement from the second quarter reading of 36.9, up nearly 24 percent. However, the index remains well below the growth threshold of 50, suggesting fewer future engineering and construction opportunities.
To access the FMI North American Engineering and Construction Outlook, please click here.
FMI is the leading provider of consulting and investment banking to the Built Environment. We provide services in the areas of strategy, leadership and organizational development, performance, technology and innovation, mergers and acquisitions, financial advisory and private equity financing.
For more information, please visit www.fminet.com.
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