Newly released data in the “Construction Financial Benchmarker” survey shows a positive shift in industry growth trends for 2014.

Published by the Construction Financial Management Association (CFMA), the survey is compiled based on the responses of more than 600 respondents including general contractors, subcontractors, construction managers and other active industry participants.

Highlighting areas such as anticipated growth segments and top challenges facing construction companies over the next five years, the survey reveals information about what the industry can expect for 2014 and beyond.

Survey Highlights

  • The industrial and nonresidential construction segment is anticipated to have the most growth,cfma_constructAion-cpas-2014-highlights while real estate development bottoms out the list.
    1. Industrial and nonresidential
    2. Heavy and highway
    3. Specialty trades
    4. Residential
    5. Real estate development
  • The average expected increase in growth for 2014 is between 0 percent and 15 percent, while only 2 percent of companies anticipate seeing growth of 50 percent or more.
  • Currently, the majority of work is being completed in the West and Midwest regions, while 14 percent is completed in the Southwest.
  • The Midwest region is anticipated to continue to be a hot spot for construction, where growth is expected to exceed 10 percent in 2014, while regions such as the Southwest expect to see growth rates just over 8 percent.
  • Today’s competitive marketplace has driven the need to know and understand your direct and indirect costs, as 56 percent of new work being obtained is through the competitive bidding process.
  • Change orders will always be an area of concern, but the survey revealed less than 40 percent of jobs result in an increase of typically 0-15 percent in the cost of bid work.
  • The top challenges construction companies anticipate facing over the next five years include:
    1. Health care insurance costs
    2. Sources of future work
    3. Lack of skilled resources
    4. Material costs
    5. Financial condition of federal, state and local governments

Are You Part of the Trend?

Wondering what all this information means for your business’ future or how you compare to the overall trends of the marketplace? Your CPA can help you understand these latest movements and trends in the industry, as well as help you implement benchmarking to establish a baseline for comparing your business with competitors and your own past performance. To drive value within your business and uncover opportunities for improvement and growth, contact our dedicated Construction CPAs in Michigan, Houston or Ft. Lauderdale for more information on our benchmarking services.

Source: Statistics based on results from the Construction Financial Management Association (CFMA) Construction Industry Annual Financial Survey, published through CFMA’s Financial Benchmarker (www.financialbenchmarker.com). This information should not be construed as the advice or opinion of CFMA.