Trimble Viewpoint has released its latest Quarterly Construction Metrics Index, which provides trends related to project starts, hiring, contract values, and cash flow metrics culled from its clients during Q2.
Here are the highlights:
Project trends
- Backlogs were up 7 percent in Q2 of 2021 compared to Q2 of 2020, demonstrating that projects are continuing to rebound.
- In Q2 2021, this equated to roughly 27,500 pending projects, which compares to 25,700 pending jobs in Q2 of 2020 — a 7-percent increase.
- Another indicator of positive growth is the Architecture Billings Index, which scored 58.5 in May, one of the highest scores ever recorded.
- Specialty contractors saw a 20 percent increase in backlogs in Q2, largely due to big project increases in April (45 percent) and May (50 percent).
- Heavy highway and civil contractors also experienced 20 percent more projects each month in Q2 than Q2 2020. General contractors saw a 12-percent decrease in projects in Q2 compared to a year ago.
Contract values
- Contract values are down 12 percent compared to Q2 2020; however, they are 20 percent higher than Q1 2021, with the largest increase in May 2021.
- Lowered contract values indicate that there is still uncertainty in the marketplace as both owners and contractors continue to try to mitigate risk.
- A reduction in high-value commercial and industrial building contracts had the biggest impact on overall contract values across the industry.
Hiring trends
- Q2 2021 saw major hiring gains, increasing roughly 23 percent year over year.
- Most of the gains came in April 2021, which saw a 100-percent increase in hiring compared to April 2020, followed by a 10-percent increase in June.
- Specialty contractors experienced the highest overall hiring growth of 9.7 percent compared to Q2 2020, and June was the highest month of growth for the vertical.
- Hiring for general contractors was up 1.45 percent compared to a year ago, with continuous growth each month and the highest growth experienced in June.
- In contrast, hiring for heavy highway and civil contractors declined 33 percent in net hiring compared to Q2 2020.
Cash flow trends
- Many contractors held on to cash in 2020 due to the uncertain business environment.
- In Q2, all verticals remained cash positive, indicating that business uncertainty remains; however, approximately 45 to 50 percent more cash was spent during Q2 2021 compared to the same time last year, a positive sign that confidence is rising and new projects are starting.
- By vertical, heavy highway and civil contractors spent 51 percent more cash in Q2 2021 compared to the previous year; specialty contractors spent 43 percent more, and general contractors spent 16 percent more, respectively.
Source: Trimble Viewpoint
