2012 Annual Report and Forecast

By Rod Sutton, Editorial Director | December 21, 2011
2012 Annual Report and Forecast

This year, we have expanded our exclusive report to include a more detailed look at the key construction industries in which our core audience does its work. We have partnered with several sister publications—each covering a specific aspect of construction—to survey the industry, in addition to our continued analysis of the fleets of construction equipment.

Our partners include Building Design+Construction, representing the nonresidential market; Professional Builder, representing the home building industry;  Professional Remodeler, representing the remodeling industry; Roads & Bridges, on the transportation front; and Water & Wastes Digest, which covers the country’s water infrastructure issues.

Construction Industry Reports

Fleet managers


Water infrastructure

Home building



As a whole, the construction industry represented by the publications in the Scranton Gillette/SGC Horizon organization hit bottom in 2011. What remains to be seen is whether the slight uptick in expectations for this year plays out into a recovery.

Respondents rated 2011 as a “poor” year, the lowest ranking available, yet only forecast 2012 to be an “off” year. Homebuilding was the exception, forecasting another “poor” business year. Expectations do not appear to be affected by region, as each of the nine geographic areas forecast an “off” year for 2012.

Expectations are likely tainted by economic and political factors as much as by their own business forecasts.

Revenue should increase this year, as the net percentage of respondents is 12.5 percent (36.4 percent expecting an increase minus 23.9 percent expecting a decrease). This compares to a net of -15.3 percent reported for 2011 (27 percent increased volume minus 42.3 decreased).

Each market expects revenue to grow in 2012, except transportation. Here, 26.6 percent say revenue will increase and 30.4 percent say it will decrease for a net of 3.8 percent. Remodeling respondents reported the greatest net increase, 23.2 percent, with 42.9 percent expecting an increase in revenue minus 19.7 percent expecting revenue to decline in 2012.  

Of course, with fewer projects in the market, competition has intensified over the past few years. This year will continue that trend. Nearly 75 percent of respondents across all regions describe their market as “intensely competitive” or “very competitive.” Respondents hope to counter this trend in their bid prices, though: 41.6 percent expect bid prices to increase and 12.9 percent expect them to decrease, for a net of 28.7 percent.

Materials pricing will help drive up bid prices, based on responses to the survey. Overall, the net is 67.5 percent (70.5 percent anticipating an increase in material prices minus 3 percent expecting a decrease). The low end was homebuilders, reporting a net of 62.6 percent (65.1 percent increasing minus 2.5 percent decreasing). Water infrastructure respondents expect the greatest price surge, with a net of 73.3 percent (75.5 percent anticipating an increase minus 2.2 percent a decrease).

Asked to rate the overall health of their firm, half of respondents said they were in “very good” or “good” shape. About 18 percent reported health as “very weak” or “weak.”

Vocational weakness is seen among home builders, where 35.4 percent reported “very good” or “good” health. Firm health was “very good” or “good” for 44.6 percent of remodelers, and 49.7 percent of nonresidential respondents. On the other hand, 50.8 percent of transportation respondents rated firm health as “very good” or “good,”  along with 53.4 percent of fleet managers and 57.7 percent in respondents involved in water infrastructure.

Appreciation and thanks go once again to Case Construction Equipment for its ongoing support and co-sponsorship of this industry report.

Methodology: More than 61,000 subscribers were e-mailed invitations to fill out questionnaires in late September and October. Excluding bouncebacks, the survey recorded a return rate of 6.1 percent with respondents broken down accordingly: nonresidential, 504; fleet managers, 502; home builders, 525; remodelers, 508; transportation, 689; water infrastructure, 1,033.

View the digital report.