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Construction Association of Michigan Releases 2009-2010 Survey Results

Sat January 16, 2010 - Midwest Edition
Construction Equipment Guide

The Construction Association of Michigan (CAM), in conjunction with Plante & Moran PLLC, has released the results of its 2009-2010 Biennial Business and Owners Survey. Conducted every two years, this survey reflects the current health of the commercial Michigan construction industry and projects the future of the industry over the next 12 to18 months. The official results are in accordance with professional contractors and owners who are involved in the construction industry on a daily basis.

Owners and developers completed the owners portion of the survey. The opinions and views of the owners are significant to the construction industry since they hire the contractors and put them to work on projects. The following sets of results are highlights taken directly from this portion of the survey.

• Satisfaction and Quality on the Rise — When asked about their general experience with the professionalism of construction personnel during the building process, 97 percent of owners were satisfied in 2009, compared with 90 percent in 2007. Likewise, 91 percent of 2009 respondents felt the overall quality of the projects was good or excellent, compared to just 77 percent in 2007. Project completion times in 2009 were on time (57 percent) as compared to on time projects in 2007 (35 percent). Sixty four percent of project delays were caused by unforeseen problems in 2009.

• Owners Embrace Green and Sustainable Building Trends — 52 percent of all owners surveyed approve of today’s sustainable building practices, and 60 percent anticipate a return on investment over the life of their building. Another current technological trend gaining popularity is BIM (Building Information Modeling). Results show that owners are utilizing contractors who are adopting these technologies.

• Economic Recovery — As in prior surveys, contractors, suppliers, architects and engineers are more optimistic than owners regarding Michigan’s current economic woes. Seventy seven percent of owners believe that Michigan’s economic recovery is still at least three years away.

Contractors, suppliers, architects and engineers completed the business portion of the survey. The following sets of results are highlights taken directly from this portion of the survey.

• Work Opportunities — The 2009 survey reflected a rise in smaller projects less than $100 K providing the most opportunities for work for contractors. Also, renovation projects are on the rise, with 40 percent of responses in 2009, as compared with just 31 percent in 2007.

• Volume of Work — This year’s survey clearly indicates a decrease in volume of work according to 79 percent of respondents. Forty nine percent indicated a decrease in 2005.

• Opinions on Recovery — The contractors, suppliers, architects, and engineers surveyed remain more optimistic about Michigan’s economic recovery than owners do. Sixty two percent of contractors, et al believe the recovery is one to two years away, and the same group of those surveyed anticipates the work level stabilizing in 2010.

• Out-of-State Construction — The trend of going outside Michigan to perform construction work doesn’t seem to be growing dramatically; 43 percent of respondents are currently doing work outside of Michigan, as opposed to 40 percent in 2007. This trend has only grown by 3 percent in the last two years.

• Competition on Jobs — According to the survey, most contractors are feeling the competition on jobs. In 2005, 55 percent of projects had fewer than five bidders; in 2009, only 25 percent had fewer than five. In 2005, 6 percent of projects had 10 or more bidders; in 2009, 33 percent had 10 or more bidders.

• Stimulus Dollars — Most contractors have not seen a big impact from stimulus dollars. However, 50 percent remain hopeful that there will be an increase in projects in the future.

• The Future of the Workforce — 60 percent of the 2009 survey respondents do not anticipate any workforce changes in the next 12 to 18 months. Only 26 percent anticipate layoffs of full or part-time employees.

• Cash Flow — Cash flow continues to be a challenge in all facets of the construction industry. Fifty eight percent of those questioned said that their cash flow in 2009 was worse than the previous year.

• Give Me Credit — Despite the tightening of the credit markets, 78 percent of respondents say they still have access to lines of credit, and 60 percent anticipate the situation staying the same or improving over the next six months.

• Profitability — According to the survey, most contractors still feel there will be a decrease in profitability in the coming year. Fifty five percent anticipate a decrease in profitability in the coming year.

• Technology on the Rise — Contractors continue to look toward new technologies to increase productivity. Sixty one percent are currently using online job bidding techniques; 26 percent are using online project management; and 73 percent are utilizing online plans and specifications. Building Information Modeling (BIM) is currently being utilized by 38 percent of architects and engineers who took the survey.

• Going Green — CAM has noted a recent increase in the interest of LEED Accredited Professionals (LEED AP). Thirty six percent of respondents have plans for their employees to become LEED certified in the future. Fifty seven percent of those taking the survey currently regularly engage in “Green” or “Sustainable” building practices.

Results of the 2009-2010 Biennial Business and Owners Survey show that an increasing number of Owners are hiring and utilizing contractors, suppliers, architects and engineers who are adopting these Green and Technological trends.

For more information, call 248/972-1000 or visit

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