FMI Releases 2022 Engineering and Construction Industry Overview

FMI Corporation recently released its “2022 Engineering and Construction Industry Overview,” which provides a comprehensive forecast for a broad range of construction and engineering segments in the United States and Canada this year.

Entering 2022, FMI analysts expect construction spending to increase by 5%. However, that growth will inevitably be offset by inflation, supply chain snarls, worker shortages, and project delays. Given this reality, FMI maintains it’s more important than ever for companies to think critically about the criteria used to bid and execute projects to maintain appropriate risk levels.

Key highlights of the report include:

• Total engineering and construction spending for the U.S. is forecast to end 2021 up 8% compared to up 6% in 2020, led primarily by the residential sector.
•  Looking at 2022, FMI forecasts 5% growth in engineering and construction spending levels compared to 2021.
•  Growth segments in 2021 are expected to include all residential segments (single-family, multi¬family, and improvements) as well as commercial, manufacturing, and sewage/waste disposal construction -- each with annual growth rates of 5% or higher.
•  A limited number of segments are expected to end the year with low growth rates between 0% and 4% -- or roughly in line with historical inflation. These stable segments include water supply, health care, and highway/street.
•  The majority (10 of 16) of nonresidential segments will end the year down. Declines through 2021 will be realized across the lodging, office, educational, public safety, religious, amusement and recreation, transportation, communication, power, and conservation and development segments.
•  The latest Nonresidential Construction Index (NRCI) feedback suggests continued optimism heading into the first quarter of 2022 (at 54.8) is up slightly from 53.8 in the prior quarter. The index has dropped from highs nearing 60 in the third quarter of 2021 but remains expansionary, suggesting increased opportunities for engineering and construction professionals ahead.

Download the full report.